The Comparative Balance Sheet of Colson Company, for 2011 and the Preceding

question 52

Essay

The comparative balance sheet of Colson Company, for 2011 and the preceding year ended December 31, 2010 appears below in condensed form:
The income statement for the current year is as follows:
Additional data for the current year are as follows:
Prepare a statement of cash flows, using the direct method of reporting cash flows from operating activities.

---

Definitions:

Crude Quantity Theory

A basic economic theory suggesting that the amount of money in supply directly affects the price level and inflation in an economy.

Sophisticated Quantity Theory

An advanced approach to Quantity Theory of Money, considering complex factors influencing money supply and demand.

Deflation

A decline in the price level for at least two years.

Keynesians

Economists and thinkers following the theories of John Maynard Keynes, who advocate for active government intervention in the economy to manage demand and avoid economic recessions.