Practice Do It! Review 1 Metlock, Inc. reported the following information for 2017 Metlock, Inc. Comparative Balance Sheets December 31 Change Assets 2017 2016Increase/Decrease $53,070$36,090$16,980 Increase 39,740 Increase Cash Accounts receivable Inventory Prepaid expenses 1,62021,880 44,300 -0 3,990 44,300 Increase 1,990 Increase 5,980 4,83069,60014,770 Decrease Land Buildings Accumulated depreciation-buildings(20.910) (13.940)6,970 Increase Equipment Accumulated depreciation-equipment(27,950(10,070) 17,880 Increase 198,720 198.720 182,2701168,670113,600 Increase $551,930 $374,940 Totals Liabilities and Stockholders' Equity Accounts payable Accrued expenses payable Bonds payable Common stock ($1 par) Retained earnings $42,780$40,020 9,920 $2.760 Increase 9,920 Decrease 99,130 149,57050.440 Decrease 230,610 179,410115,940 9,490171,120 Increase 63,470 Increase Totals $551,930 $374,940 Metlock, Inc. Income Statement For the Year Ended December 31, 2017 $932,780 Sales revenue Cost of goods sold Operating expenses $473,550 230,980 Metlock, Inc. Income Statement For the Year Ended December 31, 2017 $932,780 Sales revenue Cost of goods sold Operating expenses Interest expense Loss on disposal of equipment2,010718,550 Income before income taxes Income tax expense Net income $473,550 230,980 12,010 214,230 65,330 148,900 Additional information: 1. Operating expenses include depreciation expense of $39,740 2. Land was sold at its book value for cash. 3. Cash dividends of $85,430 were declared and paid in 2017 4. Equipment with a cost of $164,510 was purchased for cash. Equipment with a cost of $50,910 and a book value of 5. Bonds of $50,440 were redeemed at their face value for cash. 6. Common stock($1 par) of $171,120 was issued for cash. $36,020 was sold for $34,010 cash. Use this information to prepare a statement of cash flows using the indirect method. (Show amounts that decrease cash flow with either a - sign e.g.-15,000 or in parenthesis e.g. (15,000). Use this information to prepare a statement of cash flows using the indirect method. (Show amounts that decrease cash flow with either a -sign e.g.-15,000 or in parenthesis e.g. (15,000).) Metlock, Inc. Statement of Cash Flows-Indirect Method Cash Flows from Operating Activities Net Income Adjustments to reconcile net income to Loss on Disposal of Equipment Increase in Accounts Receivable Increase in Inventory Increase in Prepaid Expenses Increase in Accounts Payable Decrease in Accrued Expenses Payable Cash Flows from Operating Activities Cash Flows from Investing Activities Sale of Land Cash Flows from Operating Activities Cash Flows from Investing Activities Sale of Land Purchase of Equipment Sale of Equipment Net Cash used by Investing Activities Cash Flows from Financing Activities Redemption of Bonds Sale of Common Stock Payment of Dividends Cash Flows from Financing Activities Net Increase in Cash Cash at Beginning of Period Cash at End of Period Metlock, Inc. Statement of Cash Flows-Indirect Method December 31, 2017 Cash Flows fr For the Year Ended December 31, 2017 For the Quarter Ended December 31, 2017 Net Income Cash at Beginning of Period Cash at End of Period Cash Flows from Financing Activities Cash Flows from Investing Activities Cash Flows from Operating Activities Net Cash Provided by Financing Activities Net Cash Provided by Investing Activities Net Cash Provided by Operating Activities Net Cash used by Financing Activities Net Cash used by Investing Activities Net Cash used by Operating Activities Net Decrease in Cash Net Increase in Cash Decrease in Accounts Payable Decrease in Accounts Receivable Decrease in Accrued Expenses Payable Decrease in Inventory Decrease in Prepaid Expenses Depreciation Expense Gain on Disposal of Equipment Increase in Accounts Payable Increase in Accounts Receivable Increase in Accrued Expenses Payable Increase in Inventory Increase in Prepaid Expenses Loss on Disposal of Equipment Net Income Payment of Dividends Purchase of Equipment Redemption of Bonds Sale of Common Stock Sale of Equipment Sale of Land