Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Comparative balance sheet accounts of Shamrock Inc. are presented below. SHAMROCK INC. COMPARATIVE BALANCE SHEET ACCOUNTS AS OF DECEMBER 31, 2020 AND 2019 December

 (b) Prepare a statement of cash flows using the indirect method. (Show amounts that decrease cash flow with either a - sign e  

Comparative balance sheet accounts of Shamrock Inc. are presented below. SHAMROCK INC. COMPARATIVE BALANCE SHEET ACCOUNTS AS OF DECEMBER 31, 2020 AND 2019 December 31 Debit Accounts 2020 2019 Cash $41,600 $34,100 Accounts Receivable 70,900 60,400 Inventory 30,100 23,900 Equity investments 22,400 38,400 Machinery Buildings Land 29,700 18,900 67,000 55,800 7,600 7,600 $269,300 $239,100 Credit Accounts Allowance for Doubtful Accounts $2,200 $1,500 Accumulated Depreciation-Machinery Accumulated Depreciation-Buildings Accounts Payable 5,600 2,200 13,600 9,000 34,800 25,000 Accrued Payables Long-Term Notes Payable Common Stock, no-par Retained Earnings 3,300 2,600 21,200 31,200 150,000 125,000 38,600 42,600 $269,300 $239,100 Additional data (ignoring taxes): 1. Net income for the year was $42,200. 2. Cash dividends declared and paid during the year were $21,200. 3. A 20% stock dividend was declared during the year. $25,000 of retained earnings was capitalized. 4. Equity investments (level of ownership is less than 20%) that cost $24,800 were sold during the year for $28,500. No unrealized gains and losses were recorded on these investments in 2020. 5. Machinery that cost $3,700, on which $750 of depreciation had accumulated, was sold for $2,150. Shamrock's 2020 income statement follows (ignoring taxes). Sales revenue $539,700 Less: Cost of goods sold Gross margin Less: Operating expenses (includes $8,750 depreciation and $5,192 bad debts) Income from operations 378,700 161,000 121,700 39,300 Other: Gain on sale of investments $3,700 (800 ) Loss on sale of machinery 2,900 Net income $42,200 (a) Compute net cash flow from operating activities using the direct method. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Net cash flow from operating activities (b) 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).) (b) 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).) SHAMROCK INC. Statement of Cash Flows (Indirect Method) Adjustments to reconcile net income to

Step by Step Solution

3.47 Rating (157 Votes )

There are 3 Steps involved in it

Step: 1

a Net cash flow from operating activities 42550 b SHAMROCK INC Statement of Cash Flows Working notes ... blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Intermediate Accounting principles and analysis

Authors: Terry d. Warfield, jerry j. weygandt, Donald e. kieso

2nd Edition

471737933, 978-0471737933

More Books

Students also viewed these General Management questions