Dividends on the Statement of Cash Flows The following selected account balances are available from the records of Lewistown Company:

LO5 December 31 2010 2009 Dividends payable $ 30,000 $ 20,000 Retained earnings 375,000 250,000 Other information available for 2010 is as follows:

a. Lewistown reported net income of $285,000 for the year.

b. It declared and distributed a stock dividend of $50,000 during the year.

c. It declared cash dividends at the end of each quarter and paid them within the next 30 days of the following quarter.

Required 1. Determine the amount of cash dividends paid during the year for presentation in the Financing Activities section of the statement of cash fl ows.

2. Should the stock dividend described in

(b) appear on a statement of cash fl ows?

Explain your answer.

AppendixLO1