Statement of cash flows$$indirect method

The comparative balance sheet of Olson$-$Jones Industries Inc. for December $31,20$Y$2$ and $20$Y$1,$ is as follows:

Line Item DescriptionDecember $31,$

$20$Y$2$December $31,$

$20$Y$1$Assets$$Cash$$183$$$14$Accounts receivable $($net$)5549$Inventories$11799$Land$250330$Equipment$205175$Accumulated depreciation$$equipment$(68)(42)$Total assets$$742$$$625$Liabilities and Stockholders' Equity$$Accounts payable $($merchandise creditors$)$$$51$$$37$Dividends payable$5-$Common stock, $$1$ par$12580$Paid$-$in capital in excess of par$$common stock$8570$Retained earnings$476438$Total liabilities and stockholders' equity$$742$$$625$

The following additional information is taken from the records:

Land was sold for $$120.$

Equipment was acquired for cash.

There were no disposals of equipment during the year.

The common stock was issued for cash.

There was a $$62$ credit to Retained Earnings for net income.

There was a $$24$ debit to Retained Earnings for cash dividends declared.

Question Content Area

a$.$Prepare a statement of cash flows, using the indirect method of presenting Cash flows from $($used for$)$ operating activities. Use the minus sign to indicate cash out flows, cash payments, decreases in cash, or any negative adjustments.

Olson$-$Jones Industries, Inc.

Statement of Cash Flows

For the Year Ended December $31,20$Y$2$Line Item DescriptionAmountAmountCash flows from $($used for$)$ operating activities:

Cash received from sale of common stockDecrease in accounts receivableIncrease in inventoriesNet incomeNet lossNet income

$Net incomeAdjustments to reconcile net income to net cash flow from $($used for$)$ operating activities:

Decrease in accounts receivableDepreciationIncrease in accounts receivableLoss on sale of landNet income

$-$ Select $-$

Decrease in inventoriesGain on sale of landIncrease in accounts payableLoss on sale of landNet income

$-$ Select $-$Changes in current operating assets and liabilities:

Decrease in accounts receivableDecrease in inventoriesDepreciationIncrease in accounts receivableNet income

$-$ Select $-$

Decrease in accounts payableDecrease in accounts receivableDecrease in inventoriesIncrease in inventoriesNet income

$-$ Select $-$

Cash paid for dividendsDecrease in accounts payableDepreciationIncrease in accounts payableNet income

$-$ Select $-$

Net cash flows from operating activitiesNet cash flows from investing activitiesNet cash flows from financing activitiesNet cash flows used for operating activitiesNet cash flows used for financing activities

$$-$ Select $-$Cash flows from $($used for$)$ investing activities:

Cash paid for dividendsCash received from sale of landDepreciationGain on sale of landNet income

$$-$ Select $-$

Cash paid for purchase of equipmentCash received from sale of common stockDepreciationIncrease in inventoriesNet income

$-$ Select $-$

Net cash flows from operating activitiesNet cash flows from investing activitiesNet cash flows from financing activitiesNet cash flows used for operating activitiesNet cash flows used for investing activities

$-$ Select $-$Cash flows from $($used for$)$ financing activities:

Cash received from sale of common stockCash received from sale of landDecrease in accounts payableDepreciationNet income

$$-$ Select $-$

Cash paid for dividendsCash received from sale of landDecrease in inventoriesIncrease in accounts receivableNet income

$-$ Select $-$

Net cash flows from operating activitiesNet cash flows from investing activitiesNet cash flows from financing activitiesNet cash flows used for operating activitiesNet cash flows used for financing activities

$-$ Select $-$

Decrease in accounts payableDepreciationIncrease in accounts payableNet increase in cashNet income

$$-$ Select $-$Cash balance, January $1,20$Y$2$Cash balance, January $1,20$Y$2$Cash balance, December $31,20$Y$2$$Cash balance, December $31,20$Y$2$

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Question Content Area

b$.$Was Olson$-$Jones$$s net cash flows from operating activities more or less than net income?

LessMore

The source$($s$)$ of the difference are:

a$.$ Gain on the sale of land

b$.$ Purchase of equipment

c$.$ Sale of common stock

d$.$ Changes in current operating assets and liabilities

e$.$ Depreciation expense

c$.$ Dividends paid