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Statement of Cash Flows (Indirect Method) Use the following information regarding the Lund Corporation to (a) prepare a statement of cash flows using the indirect
Statement of Cash Flows (Indirect Method) Use the following information regarding the Lund Corporation to (a) prepare a statement of cash flows using the indirect method and (b) compute Lund's operating-cash-flow-to-current-liabilities ratio. Support Accounts payable increase Accounts receivable increase Accrued liabilities decrease Amortization expense Cash balance, January 1 Cash balance, December 31 Cash paid as dividends Cash paid to purchase land Cash paid to retire bonds payable at par Cash received from issuance of common stock Cash received from sale of equipment Depreciation expense Gain on sale of equipment Inventory decrease Net Income Prepaid expenses increase Average current liabilities $14,400 6,400 4,800 9,600 35,200 24,000 46,400 144,000 96,000 56,000 27,200 46,400 6,400 20,800 121,600 3,200 160,000 a. Use negative signs with cash outflow answers. LUND CORPORATION Statement of Cash Flows For Year Ended December 31 Cash Flow from Operating Activities Net Income Add (deduct) items to convert net income to cash basis Depreciation Amortization Gain on Sale of Equipment Accounts Receivable Increase Inventory Decrease Prepaid Expenses Increase Accounts Payable Increase Accrued Liabilities Decrease Cash Flow Provided by Operating Activities Cash Flow from Investing Activities Sale of Equipment Purchase of Land Cash Used by Investing Activities Cash Flow from Financing Activities Issuance of Common Stock Retirement of Bonds Payable Payment of Dividends Cash Used by Financing Activities Net Decrease in Cash Cash at Beginning of Year Cash at End of Year b. Operating-cash-flow-to-current liabilities ratio (Round answers to two decimal places.)
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