Statement of Cash Flows 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 $256,570 $239,760 Accounts receivable (net) 92,940 86,110 Inventories 262,370 254,970 Investments 0 98,780 Land 134,580 0 Equipment 289,480 225,410 Accumulated depreciation—equipment (67,770) (60,790) Total assets $968,170 $844,240 Liabilities and Stockholders' Equity Accounts payable $175,240 $166,320 Accrued expenses payable 17,430 21,950 Dividends payable 9,680 7,600 Common stock, $10 par 52,280 41,370 Excess of paid-in capital over par 196,540 114,820 Retained earnings 517,000 492,180 Total liabilities and stockholders' equity $968,170 $844,240 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 $88,900 cash. The common stock was issued for cash. There was a $64,500 credit to Retained Earnings for net income. There was a $39,680 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 indicate cash outflows, cash payments, decreases in cash, or any negative adjustments.

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

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	$256,570	$239,760
Accounts receivable (net)	92,940	86,110
Inventories	262,370	254,970
Investments	0	98,780
Land	134,580	0
Equipment	289,480	225,410
Accumulated depreciation—equipment	(67,770)	(60,790)
Total assets	$968,170	$844,240

Liabilities and Stockholders' Equity
Accounts payable	$175,240	$166,320
Accrued expenses payable	17,430	21,950
Dividends payable	9,680	7,600
Common stock, $10 par	52,280	41,370
Excess of paid-in capital over par	196,540	114,820
Retained earnings	517,000	492,180
Total liabilities and stockholders' equity	$968,170	$844,240

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 $88,900 cash.
The common stock was issued for cash.
There was a $64,500 credit to Retained Earnings for net income.
There was a $39,680 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 indicate cash outflows, cash payments, decreases in cash, or any negative adjustments.

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