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$197 $64 Accounts receivable (net)112 80 Inventories71 44 Land161 180 Equipment91 70 Accumulated depreciation-equipment(24) (12) Total Assets$608 $426 Liabilities and Stockholders' Equity Accounts payable (merchandise creditors)$77 $64 Dividends payable12 - Common stock, $1 par40 20 Paid-in capital: Excess of issue price over par—common stock96 50 Retained earnings383 292 Total liabilities and stockholders' equity$608 $426 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 $131 credit to Retained Earnings for net income.There was a $40 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 Adjustments to reconcile net income to net cash flow from operating activities: Depreciation fill in the blank Gain on sale of land fill in the blank Changes in current operating assets and liabilities: Increase in accounts receivable fill in the blank Increase in inventories fill in the blank Increase in accounts payable fill in the blank Net cash flow from operating activities $fill in the blank Cash flows from (used for) investing activities: Cash from sale of land $fill in the blank Cash used for purchase of equipment fill in the blank Net cash flow from investing activities fill in the blank Cash flows from (used for) financing activities: Cash from sale of common stock $fill in the blank Cash used for dividends fill in the blank Net cash flow from financing activities fill in the blank Increase in cash $fill in the blank Cash at the beginning of the year fill in the blank Cash at the end of the year $fill in the blank b. Was Olson-Jones Industries Inc.’s net cash flow from operations more or less than net income? Less

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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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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	$197		$64
Accounts receivable (net)	112		80
Inventories	71		44
Land	161		180
Equipment	91		70
Accumulated depreciation-equipment	(24)		(12)
	Total Assets	$608		$426
Liabilities and Stockholders' Equity
Accounts payable (merchandise creditors)	$77		$64
Dividends payable	12		-
Common stock, $1 par	40		20
Paid-in capital: Excess of issue price over par—common stock	96		50
Retained earnings	383		292
	Total liabilities and stockholders' equity	$608		$426

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 $131 credit to Retained Earnings for net income.
There was a $40 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
Adjustments to reconcile net income to net cash flow from operating activities:
Depreciation	fill in the blank
Gain on sale of land	fill in the blank
Changes in current operating assets and liabilities:
Increase in accounts receivable	fill in the blank
Increase in inventories	fill in the blank
Increase in accounts payable	fill in the blank
Net cash flow from operating activities		$fill in the blank
Cash flows from (used for) investing activities:
Cash from sale of land	$fill in the blank
Cash used for purchase of equipment	fill in the blank
Net cash flow from investing activities		fill in the blank
Cash flows from (used for) financing activities:
Cash from sale of common stock	$fill in the blank
Cash used for dividends	fill in the blank
Net cash flow from financing activities		fill in the blank
Increase in cash		$fill in the blank
Cash at the beginning of the year		fill in the blank
Cash at the end of the year		$fill in the blank

b. Was Olson-Jones Industries Inc.’s net cash flow from operations more or less than net income?
Less

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