A comparative balance sheet and an income statement for Burgess Company are given below:   Burgess Company Comparative Balance Sheet (dollars in millions)   Ending Balance Beginning Balance Assets     Current assets:     Cash and cash equivalents $ 55 $ 113 Accounts receivable 800 732 Inventory 730 674 Total current assets 1,585 1,519 Property, plant, and equipment 1,665 1,628 Less accumulated depreciation 866 699 Net property,plant, and equipment 799 929 Total assets $ 2,384 $ 2,448 Liabilities and Stockholders' Equity     Current liabilities:     Accounts payable $ 292 $ 176 Accrued liabilities 196 154 Income taxes payable 109 88 Total current liabilities 597 418 Bonds payable 495 760 Total liabilities 1,092 1,178 Stockholders' equity:     Common stock 225 225 Retained earnings 1,067 1,045 Total stockholders' equity 1,292 1,270 Total liabilities and stockholders' equity $ 2,384 $ 2,448   Burgess Company Income Statement (dollars in millions) Sales $ 4,180 Cost of goods sold 2,860 Gross margin 1,320 Selling and administrative expenses 912 Net operating income 408 Nonoperating items:   Gain on sale of equipment 2 Income before taxes 410 Income taxes 144 Net income $ 266   Burgess also provided the following information:   The company sold equipment that had an original cost of $44 million and accumulated depreciation of $23 million. The cash proceeds from the sale were $23 million. The gain on the sale was $2 million. The company did not issue any new bonds during the year. The company paid a cash dividend during the year. The company did not complete any common stock transactions during the year.   Required: Using the indirect method, prepare a statement of cash flows for the year.  Please enter in millions not in dollars.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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A comparative balance sheet and an income statement for Burgess Company are given below:

 

Burgess Company
Comparative Balance Sheet
(dollars in millions)
  Ending Balance Beginning Balance
Assets    
Current assets:    
Cash and cash equivalents $ 55 $ 113
Accounts receivable 800 732
Inventory 730 674
Total current assets 1,585 1,519
Property, plant, and equipment 1,665 1,628
Less accumulated depreciation 866 699
Net property,plant, and equipment 799 929
Total assets $ 2,384 $ 2,448
Liabilities and Stockholders' Equity    
Current liabilities:    
Accounts payable $ 292 $ 176
Accrued liabilities 196 154
Income taxes payable 109 88
Total current liabilities 597 418
Bonds payable 495 760
Total liabilities 1,092 1,178
Stockholders' equity:    
Common stock 225 225
Retained earnings 1,067 1,045
Total stockholders' equity 1,292 1,270
Total liabilities and stockholders' equity $ 2,384 $ 2,448

 

Burgess Company
Income Statement
(dollars in millions)
Sales $ 4,180
Cost of goods sold 2,860
Gross margin 1,320
Selling and administrative expenses 912
Net operating income 408
Nonoperating items:  
Gain on sale of equipment 2
Income before taxes 410
Income taxes 144
Net income $ 266

 

Burgess also provided the following information:

 

  1. The company sold equipment that had an original cost of $44 million and accumulated depreciation of $23 million. The cash proceeds from the sale were $23 million. The gain on the sale was $2 million.
  2. The company did not issue any new bonds during the year.

  3. The company paid a cash dividend during the year.

  4. The company did not complete any common stock transactions during the year.

 

Required:

Using the indirect method, prepare a statement of cash flows for the year. 

Please enter in millions not in dollars.

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