Condensed comparative balance sheets of Branch Company at December 31, Years 1 and 2, are as follows: Year 2 Year 1 Cash $65,000 $54,000 Accounts receivable (net) 78,000 85,000 Inventories 106,500 90,000 Land - 20,000 Equipment 495,000 370,000 Accumulated depreciation (215,000) (158,000) Total assets $529,500 $461,000 Accounts payable (merchandise creditors) $53,500 $55,000 Common stock, $10 par 200,000 170,000 Paid-in capital in excess of par 62,000 60,000 Retained earnings 214,000 176,000 Total liabilities and stockholders’ equity $529,500 $461,000 In addition, assume that equipment costing $125,000 was purchased for cash, and the land was sold for $15,000. The stock was issued for cash, and the only entries in the retained earnings account were for net income of $56,000 and cash dividends declared and paid of $18,000. Prepare a statement of cash flows for the year ended December 31, Year 2, using the indirect method. Use the minus sign to indicate cash out flows, cash payments, decreases in cash, or any negative adjustments.
Condensed comparative
Year 2 Year 1
Cash $65,000 $54,000
Inventories 106,500 90,000
Land - 20,000
Equipment 495,000 370,000
Total assets $529,500 $461,000
Accounts payable (merchandise creditors) $53,500 $55,000
Common stock, $10 par 200,000 170,000
Paid-in capital in excess of par 62,000 60,000
Total liabilities and
In addition, assume that equipment costing $125,000 was purchased for cash, and the land was sold for $15,000. The stock was issued for cash, and the only entries in the retained earnings account were for net income of $56,000 and cash dividends declared and paid of $18,000.
Prepare a statement of
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