Statement of Cash Flows—Indirect Method The comparative balance sheet of Livers Inc. for December 31, 20Y3 and 20Y2, is shown as follows: Dec. 31, 20Y3 Dec. 31, 20Y2 Assets Cash $277,520 $259,050 Accounts receivable (net) 100,540 93,040 Inventories 283,810 275,480 Investments 0 106,720 Land 145,570 0 Equipment 313,130 243,550 Accumulated depreciation—equipment (73,310) (65,680) Total assets $1,047,260 $912,160 Liabilities and Stockholders' Equity Accounts payable (merchandise creditors) $189,550 $179,700 Accrued expenses payable (operating expenses) 18,850 23,720 Dividends payable 10,470 8,210 Common stock, $10 par 56,550 44,700 Paid-in capital: Excess of issue price over par-common stock 212,590 124,050 Retained earnings 559,250 531,780 Total liabilities and stockholders’ equity $1,047,260 $912,160 Additional data obtained from an examination of the accounts in the ledger for 20Y3 are as follows: The investments were sold for $124,860 cash. Equipment and land were acquired for cash. There were no disposals of equipment during the year. The common stock was issued for cash. There was a $70,340 credit to Retained Earnings for net income. There was a $42,870 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 out flows, cash payments, decreases in cash, or any negative adjustments. Livers Inc. Statement of Cash Flows For the Year Ended December 31, 20Y3

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 Livers Inc. for December 31, 20Y3 and 20Y2, is shown as follows:

	Dec. 31, 20Y3	Dec. 31, 20Y2
Assets
Cash	$277,520		$259,050
Accounts receivable (net)	100,540		93,040
Inventories	283,810		275,480
Investments	0		106,720
Land	145,570		0
Equipment	313,130		243,550
Accumulated depreciation—equipment	(73,310)		(65,680)
	Total assets	$1,047,260		$912,160

Liabilities and Stockholders' Equity
Accounts payable (merchandise creditors)	$189,550		$179,700
Accrued expenses payable (operating expenses)	18,850		23,720
Dividends payable	10,470		8,210
Common stock, $10 par	56,550		44,700
Paid-in capital: Excess of issue price over par-common stock	212,590		124,050
Retained earnings	559,250		531,780
	Total liabilities and stockholders’ equity	$1,047,260		$912,160

Additional data obtained from an examination of the accounts in the ledger for 20Y3 are as follows:

The investments were sold for $124,860 cash.
Equipment and land were acquired for cash.
There were no disposals of equipment during the year.
The common stock was issued for cash.
There was a $70,340 credit to Retained Earnings for net income.
There was a $42,870 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 out flows, cash payments, decreases in cash, or any negative adjustments.

Livers Inc.

Statement of Cash Flows

For the Year Ended December 31, 20Y3