Statement of Cash Flows—Indirect Method 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 $305,220 $282,620 Accounts receivable (net) 110,570 101,500 Inventories 312,130 300,540 Investments 0 116,430 Land 160,100 0 Equipment 344,380 265,700 Accumulated depreciation—equipment (80,620) (71,650) Total assets $1,151,780 $995,140 Liabilities and Stockholders' Equity Accounts payable (merchandise creditors) $208,470 $196,040 Accrued expenses payable (operating expenses) 20,730 25,870 Dividends payable 11,520 8,960 Common stock, $10 par 62,200 48,760 Paid-in capital in excess of par—common stock 233,810 135,340 Retained earnings 615,050 580,170 Total liabilities and stockholders’ equity $1,151,780 $995,140 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 $136,220 cash. The common stock was issued for cash. There was a $81,650 credit to Retained Earnings for net income. There was a $46,770 debit to Retained Earnings for cash dividends declared.

Financial And Managerial Accounting

15th Edition

ISBN:9781337902663

Author:WARREN, Carl S.

Publisher:WARREN, Carl S.

Chapter13: Statement Of Cash Flows

Section: Chapter Questions

Problem 3PA: Statement of cash flowsindirect method The comparative balance sheet of Whitman Co. at December 31,...

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Question

Statement of Cash Flows—Indirect Method

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	$305,220		$282,620
Accounts receivable (net)	110,570		101,500
Inventories	312,130		300,540
Investments	0		116,430
Land	160,100		0
Equipment	344,380		265,700
Accumulated depreciation—equipment	(80,620)		(71,650)
Total assets	$1,151,780		$995,140

Liabilities and Stockholders' Equity
Accounts payable (merchandise creditors)	$208,470		$196,040
Accrued expenses payable (operating expenses)	20,730		25,870
Dividends payable	11,520		8,960
Common stock, $10 par	62,200		48,760
Paid-in capital in excess of par—common stock	233,810		135,340
Retained earnings	615,050		580,170
Total liabilities and stockholders’ equity	$1,151,780		$995,140

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 $136,220 cash.
The common stock was issued for cash.
There was a $81,650 credit to Retained Earnings for net income.
There was a $46,770 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 outflows, cash payments, decreases in cash, or any negative adjustments.

Merrick Equipment Co.Statement of Cash FlowsFor the Year Ended December 31, 20Y9

Cash flows from (used for) operating activities:	blank
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Adjustments to reconcile net income to net cash flow from operating activities:	blank
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Changes in current operating assets and liabilities:	blank
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Net cash flow from operating activities	blank	$fill in the blank 15
Cash flows from (used for) investing activities:	blank
	$- Select -
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Net cash flow used for investing activities	blank	fill in the blank 22
Cash flows from (used for) financing activities:	blank
	$- Select -
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Net cash flow from financing activities	blank	fill in the blank 27
	blank	$- Select -
Cash balance, January 1, 20Y9	blank	fill in the blank 30
Cash balance, December 31, 20Y9	blank	$fill in the blank 31

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