Comparative balance sheets for 2024 and 2023 and a statement of income for 2024 are given below for Metagrobolize Industries. Additional information from the accounting records of Metagrobolize also is provided.METAGROBOLIZE INDUSTRIESComparative Balance SheetsDecember 31, 2024 and 2023($ in thousands) 20242023Assets Cash$ 450$ 160Accounts receivable490260Inventory640385Land650590Building800800Less: Accumulated depreciation(250)(230)Equipment2,8502,570Less: Accumulated depreciation(472)(440)Patent1,7001,950 $ 6,858$ 6,045Liabilities Accounts payable$ 740$ 440Accrued liabilities220155Lease liability—land1300Shareholders' Equity Common stock2,6002,500Paid-in capital—excess of par600515Retained earnings2,5682,435 $ 6,858$ 6,045METAGROBOLIZE INDUSTRIESIncome StatementFor the Year Ended December 31, 2024($ in thousands)Revenues Sales revenue$ 2,839 Gain on sale of land65$ 2,904Expenses Cost of goods sold940 Depreciation expense—building20 Depreciation expense—equipment356 Loss on sale of equipment10 Amortization of patent250 Operating expenses6002,176Net income $ 728Additional information from the accounting records:Annual payments of $20,000 on the finance lease liability are paid each January 1, beginning in 2024.During 2024, equipment with a cost of $360,000 (90% depreciated) was sold.The statement of shareholders’ equity reveals reductions of $185,000 and $410,000 for stock dividends and cash dividends, respectively.Required:Prepare the statement of cash flows for Metagrobolize Industries using the indirect method.Note: Enter your answers in thousands (i.e., 10,000 should be entered as 10).) Amounts to be deducted should be indicated with a minus sign.

The cash flow statement is prepared at the end of the period to know the cash position. It reflects…

Answered: Comparative balance sheets for 2024 and…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Comparative balance sheets for 2024 and 2023 and a statement of income for 2024 are given below for Metagrobolize Industries. Additional information from the accounting records of Metagrobolize also is provided.

METAGROBOLIZE INDUSTRIES
Comparative Balance Sheets
December 31, 2024 and 2023
($ in thousands)
	2024	2023
Assets
Cash	$ 450	$ 160
Accounts receivable	490	260
Inventory	640	385
Land	650	590
Building	800	800
Less: Accumulated depreciation	(250)	(230)
Equipment	2,850	2,570
Less: Accumulated depreciation	(472)	(440)
Patent	1,700	1,950
	$ 6,858	$ 6,045
Liabilities
Accounts payable	$ 740	$ 440
Accrued liabilities	220	155
Lease liability—land	130	0
Shareholders' Equity
Common stock	2,600	2,500
Paid-in capital—excess of par	600	515
Retained earnings	2,568	2,435
	$ 6,858	$ 6,045

METAGROBOLIZE INDUSTRIES
Income Statement
For the Year Ended December 31, 2024
($ in thousands)
Revenues
Sales revenue	$ 2,839
Gain on sale of land	65	$ 2,904
Expenses
Cost of goods sold	940
Depreciation expense—building	20
Depreciation expense—equipment	356
Loss on sale of equipment	10
Amortization of patent	250
Operating expenses	600	2,176
Net income		$ 728

Additional information from the accounting records:

Annual payments of $20,000 on the finance lease liability are paid each January 1, beginning in 2024.
During 2024, equipment with a cost of $360,000 (90% depreciated) was sold.
The statement of shareholders’ equity reveals reductions of $185,000 and $410,000 for stock dividends and cash dividends, respectively.

Required:

Prepare the statement of cash flows for Metagrobolize Industries using the indirect method.

Note: Enter your answers in thousands (i.e., 10,000 should be entered as 10).) Amounts to be deducted should be indicated with a minus sign.

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