Multiple choice:
Statement of Cash Flows-Indirect Method The comparative balance sheet of Merrick Equipment Co. for December 31, 2019 and 2048, is as follows: Dec. 31, 2019 Dec. 31, 2018 Assets Cash Accounts receivable (net) Inventories $289,540 104,890 296,100 $271,200 97,400 288,400 111,730 Investments Land 151,870 Equipment 326,690 254,970 (68,760) Accumulated depreciation equipment (76,480) Total assets $1,092,610 $954,940 Liabilities and Stockholders' Equity Accounts payable (merchandise creditors) Accrued expenses payable (operating expenses) $188,120 24,830 8,590 Dividends payable $197,760 19,670 10,930 59,000 221,800 583,450 Common stock, $10 par 46,790 Paid-in capital in excess of par-common stock 129,870 Retained earnings 556,740 Total liabilities and stockholders' equity $1,092,610 $954,940 Additional data obtained from an examination of the accounts in the ledger for 2049 are as follows: a. Equipment and land were acquired for cash. b. There were no disposals of equipment during the year. c. The investments were sold for $130,720 cash. d. The common stock was issued for cash. e. There was a $71,590 credit to Retained Earnings for net income. f. There was a $44,880 debit to Retained Earnings for cash dividends declared. Required: Prepare a statement of cash flows, using the indirect method of presenting cash flows from operating activities. Use the minus sign to indicate cash outflows, cash payments, decreases in cash, or any negative adjustments. Merrick Equipment Co. Statement of Cash Flows For the Year Ended December 31, 2019 Cash flows from (used for) operating activities: Adjustments to reconcile net income to net cash flow from operating activities: 0 11 Changes in current operating assets and liabilities: Net cash flow from operating activities Cash flows from (used for) investing activities: Net cash flow used for investing activities Cash flows from (used for) financing activities: Net cash flow from financing activities Cash balance, January 1, 2049 Cash balance, December 31, 2049 Cash paid for dividends Cash paid for land Cash received from sale of common stock Cash received from sale of investments Loss on sale of investments Net income Decrease in accounts payable Decrease in accounts receivable Decrease in inventories Depreciation Increase in accounts receivable Loss on sale of investments Cash paid for accounts receivable Cash paid for accrued expenses Cash paid for accumulated depreciation Cash paid for inventories Cash paid for purchase of equipment Cash paid for retained earnings Cash received from gain on sale of investments Cash received from loss on sale of investments Cash received from net income Cash received from sale of common stock Net decrease in cash Net increase in cash
