Prepare a statement of cash flows, using the indirect method of presenting cash flows from (used for) 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 FlowsFor the Year Ended December 31, 20Y9
Prepare a statement of cash flows, using the indirect method of presenting cash flows from (used for) 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 FlowsFor the Year Ended December 31, 20Y9
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
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—indirect method
The comparative
balance sheet of Merrick Equipment Co. for December 31, 20Y9 and 20Y8, is as follows:Line Item Description December 31, 20Y9 December 31, 20Y8 Assets Cash $70,720 $47,940 Accounts receivable (net)207,230 188,190 Inventories 298,520 289,850 Investments 0 102,000 Land 295,800 0 Equipment 438,600 358,020 Accumulated depreciation —equipment(99,110) (84,320) Total assets $1,211,760 $901,680 Liabilities and Stockholders' Equity Accounts payable (merchandise creditors) $205,700 $194,140 Accrued expenses payable (operating expenses) 30,600 26,860 Dividends payable 25,500 20,400 Common stock, $1 par 202,000 102,000 Paid-in capital in excess of par—common stock 354,000 204,000 Retained earnings 393,960 354,280 Total liabilities and stockholders' equity $1,211,760 $901,680 Additional data obtained from an examination of the accounts in the ledger for 20Y9 are as follows:
- Equipment and land were acquired for cash.
- There were no disposals of equipment during the year.
- The investments were sold for $91,800 cash.
- The common stock was issued for cash.
- There was a $141,680 credit to Retained Earnings for net income.
- There was a $102,000 debit to Retained Earnings for cash dividends declared.
Required:
Prepare a statement of
cash flows , using the indirect method of presenting cash flows from (used for) operating activities. Use the minus sign to indicatecash outflows , cash payments, decreases in cash, or any negative adjustments.Line Item Description Amount Amount Cash flows from (used for) operating activities: $- Select - Adjustments to reconcile net income to net cash flows from (used for) operating activities: - Select - - Select - Changes in current operating assets and liabilities: - Select - - Select - - Select - - Select - $- Select - Cash flows from (used for) investing activities: $- Select - - Select - blank - Select - - Select - Cash flows from (used for) financing activities: $- Select - - Select - - Select - $- Select - Cash balance, January 1, 20Y9 Cash balance, January 1, 20Y9 Cash balance, December 31, 20Y9 $Cash balance, December 31, 20Y9
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