Comparative balance sheet accounts of Marcus Inc. are presented below. Additional data (ignoring taxes): 1. Net income
Question:
Comparative balance sheet accounts of Marcus Inc. are presented below.
Additional data (ignoring taxes):
1. Net income for the year was $42,500.
2. Cash dividends declared and paid during the year were $21,125.
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 $25,000 were sold during the year for $28,750. No unrealized gains and losses were recorded on these investments in 2020.
5. Machinery that cost $3,750, on which $750 of depreciation had accumulated, was sold for $2,200. Marcus?s 2020 income statement follows (ignoring taxes).
Instructions
a. Compute net cash flow from operating activities using the direct method.
b. Prepare a statement of cash flows using the indirect method.
DividendA dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...
Step by Step Answer:
Intermediate Accounting
ISBN: 978-1119503668
17th edition
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfiel