Problem 21-5 Statement of cash flows; direct method [LO21-3, 21-8]

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:

Annual payments of $20,000 on the finance lease liability are paid each January 1, beginning in 2018.

During 2018, equipment with a cost of $210,000 (90% depreciated) was sold.

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.)

METAGROBOLIZE INDUSTRIES

Statement of Cash Flows

For year ended December 31, 2018

($ in 000s)

Cash inflows:

Cash outflows:

Noncash investing

and financing activities: