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Prepare a statement of cash flows, using the indirect method of presenting cash flows from operating activities. Use the minus sign to indicate cash outflows, cash payments, decreases in cash, or any negative adjustments. Merrick Equinment Co

Prepare a statement of cash flows, using the indirect method of presenting cash flows from operating activities. Use the minus sign to indicate cash outflows, cash payments, decreases in cash, or any negative adjustments. Merrick Equinment Co

FINANCIAL ACCOUNTING
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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12/8/2020 CengageNOWv2 | Online teaching and learning resource from Cengage Learning Statement of Cash Flows-Indirect Method The comparative balance sheet of Merrick Equipment Co. for December 31, 20Y9 and 20Y8, is as follows: Dec, 31, 20Y9 Dec. 31, 20Y8 Assets Cash $245,780 $227,580 Accounts receivable (net) 89,040 81,740 241,990 Inventories 251,340 Investments 93,760 Land 128,920 Equipment Accumulated depreciation-equipment 277,310 213,960 (64,920) (57,700) Total assets $927,470 $801,330 Liabilities and Stockholders' Equity Accounts payable (merchandise creditors) $167,870 $157,860 Accrued expenses payable (operating expenses) 16,690 20,830 Dividends payable 9,270 7,210 Common stock, $10 par 50,080 39,270 Paid-in capital in excess of par-common stock 188,280 108,980 Retained earnings 495,280 467,180 Total liabilities and stockholders' equity $927,470 $801,330 Additional data obtained from an examination of the accounts in the ledger for 20Y9 are as follows: a. Equipment and land were acquired for cash. b. There were no disposals of equipment during the year. c. The investments were sold for $109,700 cash. d. The common stock was issued for cash. e. There was a $65,760 credit to Retained Earnings for net income. f. There was a $37,660 debit to Retained Earnings for cash dividends declared. Required: Prepare a statement of cash flows, using the indirect method of presenting cash flows from operating activities. Use the minus sign to indicate cash outflows, cash payments, decreases in cash, or any negative adjustments. Merrick Equipment Co. Statement of Cash Flows For the Year Ended December 31, 20Y9 Cash flows from (used for) operating activities: Net income Adjustments to reconcile net income to net cash flow from operating activities: Depreciation Loss on sale of investments 1/2 Changes in current operating assets and liabilities: https://v2.cengagenow.com/ilm/takeAssignment/takeAssignmentMain.do?invoker=&takeAssignmentSessionLocator=&inprogress=false
Transcribed Image Text:12/8/2020 CengageNOWv2 | Online teaching and learning resource from Cengage Learning Statement of Cash Flows-Indirect Method The comparative balance sheet of Merrick Equipment Co. for December 31, 20Y9 and 20Y8, is as follows: Dec, 31, 20Y9 Dec. 31, 20Y8 Assets Cash $245,780 $227,580 Accounts receivable (net) 89,040 81,740 241,990 Inventories 251,340 Investments 93,760 Land 128,920 Equipment Accumulated depreciation-equipment 277,310 213,960 (64,920) (57,700) Total assets $927,470 $801,330 Liabilities and Stockholders' Equity Accounts payable (merchandise creditors) $167,870 $157,860 Accrued expenses payable (operating expenses) 16,690 20,830 Dividends payable 9,270 7,210 Common stock, $10 par 50,080 39,270 Paid-in capital in excess of par-common stock 188,280 108,980 Retained earnings 495,280 467,180 Total liabilities and stockholders' equity $927,470 $801,330 Additional data obtained from an examination of the accounts in the ledger for 20Y9 are as follows: a. Equipment and land were acquired for cash. b. There were no disposals of equipment during the year. c. The investments were sold for $109,700 cash. d. The common stock was issued for cash. e. There was a $65,760 credit to Retained Earnings for net income. f. There was a $37,660 debit to Retained Earnings for cash dividends declared. Required: Prepare a statement of cash flows, using the indirect method of presenting cash flows from operating activities. Use the minus sign to indicate cash outflows, cash payments, decreases in cash, or any negative adjustments. Merrick Equipment Co. Statement of Cash Flows For the Year Ended December 31, 20Y9 Cash flows from (used for) operating activities: Net income Adjustments to reconcile net income to net cash flow from operating activities: Depreciation Loss on sale of investments 1/2 Changes in current operating assets and liabilities: https://v2.cengagenow.com/ilm/takeAssignment/takeAssignmentMain.do?invoker=&takeAssignmentSessionLocator=&inprogress=false
12/8/2020 CengageNOWv2 | Online teaching and learning resource from Cengage Learning Increase in accounts receivable Increase in inventories Increase in accounts payable Increase in accrued expenses payable atoaeA Net cash flow from operating activities Cash flows from (used for) investing activities: %24 Cash received from loss on sale of investments Cash paid for purchase of land Cash paid for purchase of equipment Net cash flow used for investing activities ydiup3 'abiordalbole bne ealiidel (2orbano saionsenloseo Cash flows from (used for) financing activities: Cash received from sale of common stock s et D80,02 Cash paid for dividends Net cash flow from financing activities Net increase in cash Cash balance, January 1, 20Y9 Cash balance, December 31, 20Y9 ator=8inprogress=false
Transcribed Image Text:12/8/2020 CengageNOWv2 | Online teaching and learning resource from Cengage Learning Increase in accounts receivable Increase in inventories Increase in accounts payable Increase in accrued expenses payable atoaeA Net cash flow from operating activities Cash flows from (used for) investing activities: %24 Cash received from loss on sale of investments Cash paid for purchase of land Cash paid for purchase of equipment Net cash flow used for investing activities ydiup3 'abiordalbole bne ealiidel (2orbano saionsenloseo Cash flows from (used for) financing activities: Cash received from sale of common stock s et D80,02 Cash paid for dividends Net cash flow from financing activities Net increase in cash Cash balance, January 1, 20Y9 Cash balance, December 31, 20Y9 ator=8inprogress=false
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