Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

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 $ 400 $ 205
Accounts receivable 390 210
Inventory 540 360
Land 550 515
Building 900 900
Less: Accumulated depreciation (300 ) (270)
Equipment 2,600 2,270
Less: Accumulated depreciation (367 ) (340 )
Patent 1,200 1,450
$ 5,913 $ 5,300
Liabilities
Accounts payable $ 640 $ 390
Accrued expenses payable 170 130
Lease liabilityland 130 0
Shareholders' Equity
Common stock 3,140 3,000
Paid-in capitalexcess of par 750 730
Retained earnings 1,083 1,050
$ 5,913 $ 5,300

METAGROBOLIZE INDUSTRIES Income Statement For the Year Ended December 31, 2018 ($ in 000s)
Revenues
Sales revenue $ 2,489
Gain on sale of land 40 $ 2,529
Expenses
Cost of goods sold $ 840
Depreciation expensebuilding 30
Depreciation expenseequipment 216
Loss on sale of equipment 15
Amortization of patent 250
Operating expenses 550 1,901
Net income $ 628

Additional information from the accounting records:

  1. Annual payments of $20,000 on the finance lease liability are paid each January 1, beginning in 2018.
  2. During 2018, equipment with a cost of $210,000 (90% depreciated) was sold.
  3. The statement of shareholders' equity reveals reductions of $160,000 and $435,000 for stock dividends and cash dividends, respectively.

Required: Prepare the statement of cash flows of Metagrobolize for the year ended December 31, 2018. Present cash flows from operating activities by the direct method. (Enter your answers in thousands (i.e., 5,000 should be entered as 5). Amounts to be deducted should be indicated with a minus sign.)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Accounting For Managers And Entrepreneurs

Authors: Charles T. Horngren

9th Edition

1323167897, 9781323167892

More Books

Students also viewed these Accounting questions

Question

Is there just cause to dismiss Bonita? Explain your answer.

Answered: 1 week ago

Question

Explain the legal term assumption of risk .

Answered: 1 week ago