Statement of Cash FlowsâIndirect Method
The comparative balance sheet of Livers Inc. for December 31,20Y3 and 20Y2, is shown as follows:
Dec. 31, 20Y3 Dec. 31, 20Y2 Assets Cash $256,770 $237,750 Accounts receivable (net) 93,020 85,390 Inventories 262,580 252,830 Investments 0 97,950 Land 134,680 0 Equipment 289,710 223,520 Accumulated depreciationâequipment (67,830) (60,280) Total assets $968,930 $837,160 Liabilities and Stockholders'Equity Accounts payable (merchandise creditors) $175,380 $164,920 Accrued expenses payable (operating expenses) 17,440 21,770 Dividends payable 9,690 7,530 Common stock, $10 par 52,320 41,020 Paid-in capital: Excess of issue price overpar-common stock 196,690 113,850 Retained earnings 517,410 488,070 Total liabilities and stockholdersâ equity $968,930 $837,160
Additional data obtained from an examination of the accounts inthe ledger for 20Y3 are as follows:
The investments were sold for $114,600 cash.
Equipment and land were acquired for cash.
There were no disposals of equipment during the year.
The common stock was issued for cash.
There was a $68,690 credit to Retained Earnings for netincome.
There was a $39,350 debit to Retained Earnings for cashdividends declared.
Required:
Prepare a statement of cash flows, using the indirect method ofpresenting cash flows from operating activities. Use the minus signto indicate cash out flows, cash payments, decreases in cash, orany negative adjustments.
LiversInc. Statement ofCash Flows For the YearEnded December 31, 20Y3 Cash flows from operating activities: $ Adjustments to reconcile net income to netcash flow from operating activities: Changes in current operating assets andliabilities: Net cash flow from operatingactivities $ Cash flows from investing activities: $ Net cash flow used for investingactivities Cash flows from financing activities: $ Net cash flow from financingactivities $ Cash at the beginning of the year Cash at the end of the year $
Statement of Cash FlowsâIndirect Method
The comparative balance sheet of Livers Inc. for December 31,20Y3 and 20Y2, is shown as follows:
| Dec. 31, 20Y3 | Dec. 31, 20Y2 | ||||
| Assets | |||||
| Cash | $256,770 | $237,750 | |||
| Accounts receivable (net) | 93,020 | 85,390 | |||
| Inventories | 262,580 | 252,830 | |||
| Investments | 0 | 97,950 | |||
| Land | 134,680 | 0 | |||
| Equipment | 289,710 | 223,520 | |||
| Accumulated depreciationâequipment | (67,830) | (60,280) | |||
| Total assets | $968,930 | $837,160 | |||
| Liabilities and Stockholders'Equity | |||||
| Accounts payable (merchandise creditors) | $175,380 | $164,920 | |||
| Accrued expenses payable (operating expenses) | 17,440 | 21,770 | |||
| Dividends payable | 9,690 | 7,530 | |||
| Common stock, $10 par | 52,320 | 41,020 | |||
| Paid-in capital: Excess of issue price overpar-common stock | 196,690 | 113,850 | |||
| Retained earnings | 517,410 | 488,070 | |||
| Total liabilities and stockholdersâ equity | $968,930 | $837,160 | |||
Additional data obtained from an examination of the accounts inthe ledger for 20Y3 are as follows:
The investments were sold for $114,600 cash.
Equipment and land were acquired for cash.
There were no disposals of equipment during the year.
The common stock was issued for cash.
There was a $68,690 credit to Retained Earnings for netincome.
There was a $39,350 debit to Retained Earnings for cashdividends declared.
Required:
Prepare a statement of cash flows, using the indirect method ofpresenting cash flows from operating activities. Use the minus signto indicate cash out flows, cash payments, decreases in cash, orany negative adjustments.
| LiversInc. | ||
| Statement ofCash Flows | ||
| For the YearEnded December 31, 20Y3 | ||
| Cash flows from operating activities: | ||
| $ | ||
| Adjustments to reconcile net income to netcash flow from operating activities: | ||
| Changes in current operating assets andliabilities: | ||
| Net cash flow from operatingactivities | $ | |
| Cash flows from investing activities: | ||
| $ | ||
| Net cash flow used for investingactivities | ||
| Cash flows from financing activities: | ||
| $ | ||
| Net cash flow from financingactivities | ||
| $ | ||
| Cash at the beginning of the year | ||
| Cash at the end of the year | $ | |
Related questions
Statement of Cash FlowsâIndirect Method
The comparative balance sheet of Merrick Equipment Co. for December 31, 20Y9 and 20Y8, is as follows:
| Dec. 31, 20Y9 | Dec. 31, 20Y8 | ||||
| Assets | |||||
| Cash | $245,600 | $227,150 | |||
| Accounts receivable (net) | 88,970 | 81,580 | |||
| Inventories | 251,170 | 241,550 | |||
| Investments | 0 | 93,580 | |||
| Land | 128,820 | 0 | |||
| Equipment | 277,110 | 213,550 | |||
| Accumulated depreciationâequipment | (64,880) | (57,590) | |||
| Total assets | $926,790 | $799,820 | |||
| Liabilities and Stockholders' Equity | |||||
| Accounts payable | $167,750 | $157,560 | |||
| Accrued expenses payable | 16,680 | 20,800 | |||
| Dividends payable | 9,270 | 7,200 | |||
| Common stock, $10 par | 50,050 | 39,190 | |||
| Paid-in capital: Excess of issue price over par-common stock | 188,140 | 108,780 | |||
| Retained earnings | 494,900 | 466,290 | |||
| Total liabilities and stockholdersâ equity | $926,790 | $799,820 | |||
Additional data obtained from an examination of the accounts in the ledger for 20Y9 are as follows:
Equipment and land were acquired for cash.
There were no disposals of equipment during the year.
The investments were sold for $84,220 cash.
The common stock was issued for cash.
There was a $66,200 credit to Retained Earnings for net income.
There was a $37,590 debit to Retained Earnings for cash dividends declared.
Required:
Prepare a statement of cash flows, using the indirect method of presenting cash flows from operating activities. Use the minus sign to indicate cash out flows, cash payments, decreases in cash, or any negative adjustments.
| Merrick Equipment Co. | ||
| Statement of Cash Flows | ||
| For the Year Ended December 31, 20Y9 | ||
| Cash flows from operating activities: | ||
| Net income | $ | |
| Adjustments to reconcile net income to net cash flow from operating activities: | ||
| Depreciation | ||
| Loss on sale of investments | ||
| Changes in current operating assets and liabilities: | ||
| Increase in accounts receivable | ||
| Increase in inventories | ||
| Increase in accounts payable | ||
| Decrease in accrued expenses payable | ||
| Net cash flow from operating activities | $ | |
| Cash flows from (used for) investing activities: | ||
| Cash from sale of investments | $ | |
| Cash used for purchase of land | ||
| Cash used for purchase of equipment | ||
| Net cash flow used for investing activities | ||
| Cash flows from (used for) financing activities: | ||
| Cash from sale of common stock | ||
| Cash used for dividends | ||
| Net cash flow from financing activities | ||
| Increase in cash | $ | |
| Cash at the beginning of the year | ||
| Cash at the end of the year | $ | |
The comparative balance sheet of Merrick Equipment Co. for December 31, 20Y9 and 20Y8, is as follows:
| Dec. 31, 20Y9 | Dec. 31, 20Y8 | ||||
| Assets | |||||
| Cash | $266,740 | $248,130 | |||
| Accounts receivable (net) | 96,630 | 89,120 | |||
| Inventories | 272,790 | 263,860 | |||
| Investments | 0 | 102,220 | |||
| Land | 139,910 | 0 | |||
| Equipment | 300,960 | 233,280 | |||
| Accumulated depreciationâequipment | (70,460) | (62,910) | |||
| Total assets | $1,006,570 | $873,700 | |||
| Liabilities and Stockholders' Equity | |||||
| Accounts payable | $182,190 | $172,120 | |||
| Accrued expenses payable | 18,120 | 22,720 | |||
| Dividends payable | 10,070 | 7,860 | |||
| Common stock, $10 par | 54,350 | 42,810 | |||
| Paid-in capital: Excess of issue price over par-common stock | 204,330 | 118,820 | |||
| Retained earnings | 537,510 | 509,370 | |||
| Total liabilities and stockholdersâ equity | $1,006,570 | $873,700 | |||
Additional data obtained from an examination of the accounts in the ledger for 20Y9 are as follows:
Equipment and land were acquired for cash.
There were no disposals of equipment during the year.
The investments were sold for $92,000 cash.
The common stock was issued for cash.
There was a $69,200 credit to Retained Earnings for net income.
There was a $41,060 debit to Retained Earnings for cash dividends declared.
Required:
Prepare a statement of cash flows, using the indirect method of presenting cash flows from operating activities. Use the minus sign to indicate cash out flows, cash payments, decreases in cash, or any negative adjustments.
| Merrick Equipment Co. | ||
| Statement of Cash Flows | ||
| For the Year Ended December 31, 20Y9 | ||
| Cash flows from operating activities: | ||
| $ | ||
| Adjustments to reconcile net income to net cash flow from operating activities: | ||
| Changes in current operating assets and liabilities: | ||
| Net cash flow from operating activities | $ | |
| Cash flows from (used for) investing activities: | ||
| $ | ||
| Net cash flow used for investing activities | ||
| Cash flows from (used for) financing activities: | ||
| Net cash flow from financing activities | ||
| $ | ||
| Cash at the beginning of the year | ||
| Cash at the end of the year | $ | |
