Ch 22: Homework Question 6 of 8 -/ 15 Martinez House Inc. had the following condensed statement of financial position at December 31, 2019: MARTINEZ HOUSE INC. Statement of Financial Position December 31, 2019 Cash Current assets (non-cash) Bond investment at amortized cost Plant assets (net) Land $10,700 34.500 40,850 58.250 38,650 $182,950 Current liabilities Long-term notes payable Bonds payable Common shares Retained earnings $15.250 30.700 32,150 80.850 24,000 $182,950 Martinez House Inc. follows IFRS and chooses to classify dividends paid as financing activities and interest paid as operating activities on the statement of cash flows. During 2020, the following occurred: 1. 2. 3. 4. 5. Martinez House Inc. sold part of its investment portfolio in bonds for $16,300, resulting in a gain of $200. Dividends totalling $19,000 were paid to shareholders. A parcel of land, to be used as a parking lot was purchased for $3,500. Common shares were issued for cash totalling $18.900. Bonds payable of $9,400 were retired at par. Equipment was purchased through the issuance of $29,000 of bonds. Net income for 2020 was $47,000 after allowing for depreciation on Martinez House Incs plant assets of $14,500. The amount of interest paid during 2020 was $4,220 and the amount of income taxes paid was $20.600. Both current assets (other than cash) and current liabilities remained at the same amount. 6. 7. 8. Prepare a statement of cash flows for 2020 using the indirect method. (Show amounts that decrease cash flow with either a-sign eg.-15,000 or in parenthesis eg. (15,000).) MARTINEZ HOUSE INC. Statement of Cash Flows (Indirect Method) Adjustments to reconcile net income to net cash provided by operating activities: $ $ Supplemental disclosures of cash flow information: Prepare a statement of cash flows for 2020 using the indirect method. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).) MARTINEZ HOUSE INC. Statement of Cash Flows (Indirect Method) $ $ Net Cash Provided by Operating Activities Net Cash Provided by Investing Activities Net Increase in Cash Net Cash Used by Investing Activities Cash Balance, January 1, 2020 Cash Flows from Financing Activities Net Cash Used by Financing Activities Cash Flows from Operating Activities Net Decrease in Cash Cash Balance, December 31, 2020 Non-Cash Investing and Financing Activities Non-Cash Operating and Financing Activities Net Cash Provided by Financing Activities Cash Flows from Investing Activities Net Cash Used by Operating Activities Prepare a statement of cash flows for 2020 using the indirect method. (Show amounts that decrease cash flow with either a-sign eg.-15,000 or in parenthesis eg. (15,000).) MARTINEZ HOUSE INC. Statement of Cash Flows (Indirect Method) Gain on Disposal of Investment in Bonds Proceeds on Sale of Investment in Bonds Issuance of Bonds for Equipment Payments to Retire Bonds Payable Sale of Land Cash Paid During the Year for Interest Dividends Paid Cash Paid During the Year for Income Taxes Purchase of Land Depreciation Expense Loss on Disposal of Investment in Bonds Proceeds from Issuance of Common Shares Net Income /(Loss) Prepare a statement of cash flows for 2020 using the indirect method. (Show amounts that decrease cash flow with either a-sign eg.-15,000 or in parenthesis eg. (15,000.) MARTINEZ HOUSE INC. Statement of Cash Flows (Indirect Method) Adjustments to reconcile net income to net cash provided by operating activities: $ Cash Paid During the Year for Income Taxes Net Income /(Loss) Loss on Disposal of Investment in Bonds Gain on Disposal of Investment in Bonds Proceeds from Issuance of Common Shares Dividends Paid Depreciation Expense Issuance of Bonds for Equipment Cash Paid During the Year for Interest Sale of Land Proceeds on Sale of Investment in Bonds Payments to Retire Bonds Payable Purchase of Land MARTINEZ HOUSE INC. Statement of Cash Flows (Indirect Method) Adjustments to reconcile net income to net cash provided by operating activities: Cash Balance, January 1, 2020 Net Increase in Cash Non-Cash Operating and Financing Activities Non-Cash Investing and Financing Activities Net Cash Provided by Investing Activities Cash Flows from Financing Activities Net Cash Used by Investing Activities Net Decrease in Cash Net Cash Used by Financing Activities Cash Flows from Investing Activities Cash Balance, December 31, 2020 Cash Flows from Operating Activities Net Cash Used by Operating Activities Net Cash Provided by Financing Activities Net Cash Provided by Operating Activities Question 6 of 8 - / 1 E $ Supplemental disclosures of cash flow information: $ Proceeds on Sale of Investment in Bonds Cash Paid During the Year for Interest Proceeds from Issuance of Common Shares Net Income / (Loss) Cash Paid During the Year for Income Taxes Loss oss on Disposal of Investment in Bands Dividends Paid Issuance of Bonds for Equipment Depreciation Expense Payments to Retire Bonds Payable Purchase of Land Sale of Land Gain on Disposal of Investment in Bonds Assistance Used ition at December 31, 2020, for Martinez House Inc. (List Assets in order of Prepare a condensed statement of financial position at December 31, 2020, for Martinez House Inc. (List Assets in order of liquidity.) MARTINEZ HOUSE INC. Statement of Financial Position For the Year Ended December 31, 2020 Assets $ Liabilities and Equity $ $ Prepare a condensed statement of financial position at December 31, 2020, for Martinez House Inc. (List Assets in order of liquidity.) MARTINEZ HOUSE INC. Statement of Financial Position For the Year Ended December 31, 2020 Assets $ Current Liabilities Common Shares Long-Term Notes Payable Current Assets Other than Cash Bond Investment at Amortized Cost Bonds Payable Cash Land Retained Earnings Plant Assets (Net) $ Liabilities and Equity $ $