Comparative financial statements for Weaver Company follow: Weaver Company Comparative Balance Sheet at December 31 This Year Last Year Assets Cash Accounts receivable Inventory Prepaid expenses Total current assets Property, plant, and equipment Less accumulated depreciation Net property, plant, and equipment Long-term investments Total assets Liabilities and Stockholders' Equity Accounts payable Accrued liabilities Income taxes payable Total current liabilities Bonds payable Total liabilities Common stock Retained earnings Total stockholders' equity Total liabilities and stockholders' equity $ 11 292 159 8 470 505 (83) 422 27 $ 919 $ 12 230 195 5 442 426 (71) 355 33 $830 $ 300 70 73 443 196 639 161 119 280 $ 919 $224 78 63 365 172 537 201 92 293 $830 Weaver Company Income Statement For This Year Ended December 31 Sales Cost of goods sold Gross margin Selling and administrative expenses Net operating income Nonoperating items: Gain on sale of investments 67 Loss on sale of equipment (2) Income before taxes Income taxes Net income $754 450 304 219 85 5 90 23 6 67 During this year. Weaver sold some equipment for $19 that had cost $31 and on which there was accumulated depreciation of $10. In addition, the company sold long-term investments for $13 that had cost $6 when purchased several years ago. Weaver paid a cash dividend this year and the company repurchased $40 of its own stock. This year Weaver did not retire any bonds. Required: 1. Using the Indirect method, determine the net cash provided by used in operating activities for this year. (List any deduction in cash and cash outflows as negative amounts.) $ 67 Weaver Company Statement of Cash Flows --Indirect Method (partial) The income Adjustments to convert net income to a cash basis Depreciation Gain on sale of investments Loss on sale of equipment Increase in accounts receivable Decrease in inventory increase in prepaid expenses Increase in accounts payable Decrease in accrued liabilities 2 Using the information from Part 1, along with an analysis of the remaining balance sheet accounts, prepare a statement of cash flows for this year. (List any deduction in cash and cash outflows as negative amounts.) Weaver Company Statement of Cash Flows For This Year Ended December 31 Operating activities Net cash provided by operating activities Investing activities Gain on sale of equipment Gain on sale of investments Cash dividends paid 0 Net cash used in investing activities: Financing activities Repurchase of common stock $ A comparative balance sheet and an income statement for Burgess Company are given below: Burgess Company Comparative Balance Sheet (dollars in millions) Ending Beginning Balance Balance Assets Current assets: Cash and cash equivalents 44 91 Accounts receivable 690 633 Inventory 675 630 Total current assets 1,409 1,354 Property, plant, and equipment 1,555 1,529 Legg accumulated depreciation 800 666 Net property, plant, and equipment 755 863 Total assets 52,164 $2,217 Liabilities and Stockholders' Equity Current liabilities: Accounts payable $ 270 $ 165 Accrued liabilities 185 165 Income taxes payable 87 77 Total current liabilities 542 407 Bonds payable 650 Total liabilities 982 1,057 Stockholders' equity: Common stock 170 170 Retained earnings 1,012 990 Total stockholders' equity 1,160 Total liabilities and stockholders' equity 52,164 82.217 Burgess Company Income Statement (dollars in millions) Sales Coat of gooda gold Gross margin Seiling and administrative expenses Net operating income Nonoperating items! Gain on sale of equipment Income before taxes Income taxes Net income $3,850 2,640 1,210 890 320 122 200 Burgess also provided the following information 1. The company sold equipment that had an original cost of $22 million and accumulated depreciation of $12 million. The cash proceeds from the sale were $12 million. The gain on the sale was $2 million 2. The company did not issue any new bonds during the year 3. The company paid a cash dividend during the year 4. The company did not complete any common stock transactions during the year, Required: Using the Indirect method, prepare a statement of cash flows for the year (Enter your answers in millions not in dollars. List any Required: Using the indirect method, prepare a statement of cash flows for the year. (Enter your answers in millions nor in dollars. List any deduction in cash and cash outflows as negative amounts.) Burgess Company Statement of Cash Flows Operating activities: Net income Adjustments to convert net income to a cash basis 0 0 Investing activities
