Statement of Cash Flows—Indirect MethodThe comparative balance sheet of Olson-Jones Industries Inc. for December 31, 20Y2 and 20Y1, is as follows: Dec. 31, 20Y2Dec. 31, 20Y1Assets Cash$159 $53 Accounts receivable (net)90 66 Inventories57 36 Land129 148 Equipment73 58 Accumulated depreciation-equipment(20) (10) Total Assets$488 $351 Liabilities and Stockholders' Equity Accounts payable (merchandise creditors)$61 $53 Dividends payable10 - Common stock, $1 par32 16 Paid-in capital: Excess of issue price over par—common stock71 41 Retained earnings314 241 Total liabilities and stockholders' equity$488 $351 The following additional information is taken from the records:Land was sold for $48.Equipment was acquired for cash.There were no disposals of equipment during the year.The common stock was issued for cash.There was a $105 credit to Retained Earnings for net income.There was a $32 debit to Retained Earnings for cash dividends declared.a. Prepare a statement of cash flows, using the indirect method of presenting cash flows from operating activities. Use the minus sign to indicate cash out flows, cash payments, decreases in cash, or any negative adjustments.Olson-Jones Industries Inc.Statement of Cash FlowsFor the Year Ended December 31, 20Y2Cash flows from operating activities: Net income $fill in the blank 4dc215ff8fd2f7f_2 Adjustments to reconcile net income to net cash flow from operating activities: Depreciation fill in the blank 4dc215ff8fd2f7f_4 Gain on sale of land fill in the blank 4dc215ff8fd2f7f_6 Changes in current operating assets and liabilities: Increase in accounts receivable fill in the blank 4dc215ff8fd2f7f_8 Increase in inventories fill in the blank 4dc215ff8fd2f7f_10 Increase in accounts payable fill in the blank 4dc215ff8fd2f7f_12 Net cash flow from operating activities $fill in the blank 4dc215ff8fd2f7f_13Cash flows from (used for) investing activities: Cash from sale of land $fill in the blank 4dc215ff8fd2f7f_15 Cash used for purchase of equipment fill in the blank 4dc215ff8fd2f7f_17 Net cash flow from investing activities fill in the blank 4dc215ff8fd2f7f_18Cash flows from (used for) financing activities: Cash from sale of common stock $fill in the blank 4dc215ff8fd2f7f_20 Cash used for dividends fill in the blank 4dc215ff8fd2f7f_22 Net cash flow from financing activities fill in the blank 4dc215ff8fd2f7f_23Increase in cash $fill in the blank 4dc215ff8fd2f7f_25Cash at the beginning of the year fill in the blank 4dc215ff8fd2f7f_26Cash at the end of the year

A Cash Flow Statement shows inflow and outflow of cash and cash equivalents from various activities…

Answered: Prepare a statement of cash flows,…

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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Question

Statement of Cash Flows—Indirect Method

The comparative balance sheet of Olson-Jones Industries Inc. for December 31, 20Y2 and 20Y1, is as follows:

	Dec. 31, 20Y2	Dec. 31, 20Y1
Assets
Cash	$159		$53
Accounts receivable (net)	90		66
Inventories	57		36
Land	129		148
Equipment	73		58
Accumulated depreciation-equipment	(20)		(10)
	Total Assets	$488		$351
Liabilities and Stockholders' Equity
Accounts payable (merchandise creditors)	$61		$53
Dividends payable	10		-
Common stock, $1 par	32		16
Paid-in capital: Excess of issue price over par—common stock	71		41
Retained earnings	314		241
	Total liabilities and stockholders' equity	$488		$351

The following additional information is taken from the records:

Land was sold for $48.
Equipment was acquired for cash.
There were no disposals of equipment during the year.
The common stock was issued for cash.
There was a $105 credit to Retained Earnings for net income.
There was a $32 debit to Retained Earnings for cash dividends declared.

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

Olson-Jones Industries Inc.
Statement of Cash Flows
For the Year Ended December 31, 20Y2
Cash flows from operating activities:
Net income	$fill in the blank 4dc215ff8fd2f7f_2
Adjustments to reconcile net income to net cash flow from operating activities:
Depreciation	fill in the blank 4dc215ff8fd2f7f_4
Gain on sale of land	fill in the blank 4dc215ff8fd2f7f_6
Changes in current operating assets and liabilities:
Increase in accounts receivable	fill in the blank 4dc215ff8fd2f7f_8
Increase in inventories	fill in the blank 4dc215ff8fd2f7f_10
Increase in accounts payable	fill in the blank 4dc215ff8fd2f7f_12
Net cash flow from operating activities		$fill in the blank 4dc215ff8fd2f7f_13
Cash flows from (used for) investing activities:
Cash from sale of land	$fill in the blank 4dc215ff8fd2f7f_15
Cash used for purchase of equipment	fill in the blank 4dc215ff8fd2f7f_17
Net cash flow from investing activities		fill in the blank 4dc215ff8fd2f7f_18
Cash flows from (used for) financing activities:
Cash from sale of common stock	$fill in the blank 4dc215ff8fd2f7f_20
Cash used for dividends	fill in the blank 4dc215ff8fd2f7f_22
Net cash flow from financing activities		fill in the blank 4dc215ff8fd2f7f_23
Increase in cash		$fill in the blank 4dc215ff8fd2f7f_25
Cash at the beginning of the year		fill in the blank 4dc215ff8fd2f7f_26
Cash at the end of the year

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