(a) Prepare a statement of cash flows using the indirect method. (Show amounts that decrease cash flow using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)
(a) Prepare a statement of cash flows using the indirect method. (Show amounts that decrease cash flow using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:A comparative statement of financial position for Blue Spruce Industries Inc. follows:
BLUE SPRUCE INDUSTRIES INC.
Statement of Financial Position
December 31, 2020
Assets
Cash
Accounts receivable
Inventory
Land
Equipment.
269,000 216,000
Accumulated depreciation-equipment (70,300) (43,500)
Total
$654,500 $579,900
Liabilities and Shareholders' Equity
Accounts payable
Bonds payable
Common shares
Retained earnings
Total
Additional information:
December 31
2020
2019
$22,800 $35,800
122,000
55,600
234,000
191,000
77,000 125,000
$52,400 $59,500
163,800 213,800
233,000 183,000
205,300 123,600
$654,500 $579,900
1. Net income for the fiscal year ending December 31, 2020, was $130,000.
2.
Cash dividends of $48,300 were declared and paid. Dividends paid are treated as financing activities.
3. Bonds payable amounting to $50,000 were retired through issuance of common shares.
4. Land was sold at a gain of $4,000.
5. No equipment was sold during the year.
O
(a)
Prepare a statement cash flows using the indirect method. (Show amounts that decrease cash flow using either a negative sign preceding the number e.g. -45 or parentheses e.g.
(45).)
BLUE SPRUCE INDUSTRIES INC.
Statement of Cash Flows
C
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