Question
Comparative balance sheets for 2018 and 2017 and a statement of income for 2018 are given below for Metagrobolize Industries. Additional information from the accounting
Comparative balance sheets for 2018 and 2017 and a statement of income for 2018 are given below for Metagrobolize Industries. Additional information from the accounting records of Metagrobolize also is provided.
METAGROBOLIZE INDUSTRIES
Comparative Balance Sheets December 31, 2018 and 2017 ($ in 000s)
2018 2017
Assets
Cash $ 390 $ 190
Accounts receivable 450 240
Inventory 600 375
Land 600 560
Building 900 900
Less: Accumulated depreciation (300 ) (285 )
Equipment 2,750 2,450
Less: Accumulated depreciation (430 ) (400 )
Patent 1,500 1,650
$ 6,460 $ 5,680
Liabilities
Accounts payable $ 700 $ 550
Accrued expenses payable 200 175
Lease liabilityland 130 0
Shareholders' Equity
Common stock 3,110 3,000
Paid-in capitalexcess of par 550 485
Retained earnings 1,770 1,470
$ 6,460 $ 5,680
METAGROBOLIZE INDUSTRIES I
ncome Statement For the Year Ended December 31, 2018 ($ in 000s)
Revenues
Sales revenue $ 2,765
Gain on sale of land 55
$ 2,820
Expenses
Cost of goods sold $ 900
Depreciation expensebuilding 15
Depreciation expenseequipment 300
Loss on sale of equipment 10
Amortization of patent 150
Operating expenses $ 550 1,925
Net income $ 895
Additional information from the accounting records:
Annual payments of $20,000 on the finance lease liability are paid each January 1, beginning in 2018.
During 2018, equipment with a cost of $300,000 (90% depreciated) was sold.
The statement of shareholders equity reveals reductions of $175,000 and $420,000 for stock dividends and cash dividends, respectively.
Required: Prepare the statement of cash flows for Metagrobolize Industries using the indirect method. (Enter your answers in thousands. (i.e., 10,000 should be entered as 10).) Amounts to be deducted should be indicated with a minus sign.)
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