P11-2B. Preparing a statement of cash flows-indirect method (Learning Objective 3) 20-25 min. Data from the comparative statement of financial position of Gibson's Greenhouse Inc. at May 31, 2024, follow: May 31 Current Assets: Cash and Cash Equivalents. Accounts Receivable.. Inventory. Current Liabilities: Accounts Payable. Accrued Liabilities. Income Tax Payable.. Payment of cash dividend......... $30,500 Purchase of 18,300 equipment for cash Issuance of long-term note payable in exchange for cash. ● Gibson's Greenhouse Inc.'s transactions during the year ended May 31, 2024, included: Requirements 53,000 building for cash 2024 Net Earnings. Issuance of Depreciation Expense........ Purchase of common shares 2023 $13,500 $4,100 14,400 21,500 54,900 53,700 $29,100 $28,400 14,700 16,500 8,000 4,400 $17,300 107,500 73,000 14,000 1. Prepare Gibson's Greenhouse Inc.'s statement of cash flows for the year ended May 31, 2024, using the indirect method to report cash flows from operating activities. 2. Evaluate Gibson's Greenhouse Inc.'s cash flows for the year. Mention all three categories of cash flows and give the reason(s) for your evaluation.
P11-2B. Preparing a statement of cash flows-indirect method (Learning Objective 3) 20-25 min. Data from the comparative statement of financial position of Gibson's Greenhouse Inc. at May 31, 2024, follow: May 31 Current Assets: Cash and Cash Equivalents. Accounts Receivable.. Inventory. Current Liabilities: Accounts Payable. Accrued Liabilities. Income Tax Payable.. Payment of cash dividend......... $30,500 Purchase of 18,300 equipment for cash Issuance of long-term note payable in exchange for cash. ● Gibson's Greenhouse Inc.'s transactions during the year ended May 31, 2024, included: Requirements 53,000 building for cash 2024 Net Earnings. Issuance of Depreciation Expense........ Purchase of common shares 2023 $13,500 $4,100 14,400 21,500 54,900 53,700 $29,100 $28,400 14,700 16,500 8,000 4,400 $17,300 107,500 73,000 14,000 1. Prepare Gibson's Greenhouse Inc.'s statement of cash flows for the year ended May 31, 2024, using the indirect method to report cash flows from operating activities. 2. Evaluate Gibson's Greenhouse Inc.'s cash flows for the year. Mention all three categories of cash flows and give the reason(s) for your evaluation.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Accounting
Transcribed Image Text:P11-2B. Preparing a statement of cash flows-indirect method (Learning Objective 3) 20-25 min.
Data from the comparative statement of financial position of Gibson's Greenhouse Inc. at May 31, 2024,
follow:
May 31
Current Assets:
Cash and Cash Equivalents.
Accounts Receivable.
Inventory.....
Current Liabilities:
Accounts Payable.
Accrued Liabilities
Income Tax Payable.
Payment of cash dividend ......... $30,500
Purchase of
18,300
equipment for cash
Issuance of long-term
note payable in exchange
for cash.
● Gibson's Greenhouse Inc.'s transactions during the year ended May 31, 2024,
included:
Requirements
53,000
Depreciation Expense.
Purchase of
building for cash
Net Earnings.
Issuance of
2024
common shares
2023
$13,500 $4,100
14,400 21,500
54,900 53,700
$29,100 $28,400
14,700
16,500
8,000
4,400
$17,300
107,500
73,000
14,000
1. Prepare Gibson's Greenhouse Inc.'s statement of cash flows for the year ended May 31,
2024, using the indirect method to report cash flows from operating activities.
2. Evaluate Gibson's Greenhouse Inc.'s cash flows for the year. Mention all three categories
of cash flows and give the reason(s) for your evaluation.
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