Preparation of Cash Flows Statement in Indirect method.
The comparative balance sheet of Oak and Tile Flooring Co. for June 30, 2008 and 2007, is as follows:
Statement of cash ___________________________________ June 30, 2008 ________ June 30,2007
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Flows-indirect method
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Assests
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Obj. 2 Cash.........................................................
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$34,700
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$23,500
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Net cash flow from Accounts receivable (net).....................
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101,600
|
92,300
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Operating activities, Inventories.......................................
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146,300
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142,100
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$72,200 Investments.................................................
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0
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50,000
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Equipment....................................................
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215,000
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175,000
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Accumulated depreciation.......................
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-48,600
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-41,300
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|
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$594,000
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$442,100
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Liabilities and Stockholders'
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Equity
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|
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Accounts payable (merchandise creditors)..
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$100,900
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$95,200
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Accrued expenses (operating expenses)........
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15,000
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13,200
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Dividends payable..............................................
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12,500
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10,000
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Common stock, $1 par......................................
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56,000
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50,000
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Paid-in capital in excess of par-common stock..
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220,000
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100,000
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Retained earnings.................................................
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189,000
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173,700
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|
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$594,000
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$442,000
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The following additional information was taken from the records of Oak and Tile Flooring Co.:
a. Equipment and land were acquired for cash.
b. There were no disposals of equipment during the year.
c. The investments were sold for $45,000 cash.
d. The common stock was issued for cash.
e. There was a $65,900 credit to Retained Earnings for net income.
f. There was a $50,000 debit to Retained Earnings for cash dividends declared.
Instructions
Prepare a statement of cash flows, using the indirect method of presenting cash flows from operating activities.