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Comparative balance sheets for 2021 and 2020 and a statement of income for 2021 are given below for Metagrobolize Industries. Additional information from the accounting records of Metagrobolize also is provided. METAGROBOLIZE INDUSTRIES Comparative Balance Sheets December 31, 2021 and 2020 ($ in thousands) 2021 2020 Assets Cash Accounts receivable Inventory Land Building Less: Accumulated depreciation Equipment Less: Accumulated depreciation Patent $ 450 490 640 650 800 (250) 2,850 (472) 1,700 $ 6,858 $ 160 260 385 590 800 (230) 2,570 (440) 1,950 $ 6,045 $ $ 740 220 130 440 155 0 Liabilities Accounts payable Accrued liabilities Lease liability-land Shareholders' Equity Common stock Paid-in capital-excess of par Retained earnings 2,600 600 2,568 $ 6,858 2,500 515 2,435 $ 6,045 $ 2,904 METAGROBOLIZE INDUSTRIES Income Statement For the Year Ended December 31, 2021 ($ in thousands) Revenues Sales revenue $ 2,839 Gain on sale of land 65 Expenses Cost of goods sold 940 Depreciation expense-building 20 Depreciation expense-equipment 356 Loss on sale of equipment 10 Amortization of patent 250 Operating expenses 600 Net income 21****** 2,176 $ 728 Additional information from the accounting records: a. Annual payments of $20,000 on the finance lease liability are paid each January 1, beginning in 2021. b. During 2021, equipment with a cost of $360,000 (90% depreciated) was sold. c. The statement of shareholders' equity reveals reductions of $185,000 and $410,000 for stock dividends and cash dividends, respectively. Required: Prepare the statement of cash flows for Metagrobolize Industries using the indirect method. (Enter your answers in thousands (i.e., 10,000 should be entered as 10).) Amounts to be deducted should be indicated with a minus sign.) 728 METAGROBOLIZE INDUSTRIES Statement of Cash Flows For year ended December 31, 2021 ($ in 000s) Cash flows from operating activities: Net income $ Adjustments for noncash effects: Depreciation expense - Building Depreciation expense - Equipment Loss on sale of equipment Amortization expense Gain on sale of land 20 365 10 250 (65) Changes in operating assets and liabilities: Increase in accounts receivable Increase in inventory Increase in accounts payable Increase in accrued expenses (230) (255) 300 65 $ 1,188 Net cash flows from operating activities Cash flows from investing activities: Sale of equipment Sale of land 324 Net cash flows from investing activities 324 365 10 Depreciation expense - Equipment Loss on sale of equipment Amortization expense Gain on sale of land 250 (65) Changes in operating assets and liabilities: Increase in accounts receivable Increase in inventory Increase in accounts payable Increase in accrued expenses (230) (255) 300 65 $ 1,188 Net cash flows from operating activities Cash flows from investing activities: Sale of equipment Sale of land 324 324 Net cash flows from investing activities Cash flows from financing activities: Payment of dividends Payment on lease liability (595) (20) (615) Net cash flows from financing activities Net increase in cash Cash balance, January 1 Cash balance, December 31 Noncash investing and financing activities: 160 $ 160
