The comparative balance sheet of Merrick Equipment Co. for December 31, 20Y9, and 20Y8, is as follows:

		Dec. 31, 20Y9		Dec. 31, 20Y8
Assets
Cash		$245,600		$227,150
Accounts receivable (net)		88,970		81,580
Inventories		251,170		241,550
Investments		0		93,580
Land		128,820		0
Equipment		277,110		213,550
Accumulated depreciation—equipment		(64,880)		(57,590)
	Total assets	$926,790		$799,820
Liabilities and Stockholders' Equity
Accounts payable		$167,750		$157,560
Accrued expenses payable		16,680		20,800
Dividends payable		9,270		7,200
Common stock, $10 par		50,050		39,190
Paid-in capital: Excess of issue price over par-common stock		188,140		108,780
Retained earnings		494,900		466,290
	Total liabilities and stockholders’ equity	$926,790		$799,820

Additional data obtained from an examination of the accounts in the ledger for 20Y9 are as follows:

Equipment and land were acquired for cash.

There were no disposals of equipment during the year.

The investments were sold for $84,220 cash.

The common stock was issued for cash.

There was a $66,200 credit to Retained Earnings for net income.

There was a $37,590 debit to Retained Earnings for cash dividends declared.

Required:

Prepare a statement of cash flows, using the indirect method of presenting cash flows from operating activities. Use the minus sign to indicate cash outflows, cash payments, decreases in cash, or any negative adjustments.

Merrick Equipment Co.
Statement of Cash Flows
For the Year Ended December 31, 20Y9
Cash flows from operating activities:
Net income	$
Adjustments to reconcile net income to net cash flow from operating activities:
Depreciation
Loss on sale of investments
Changes in current operating assets and liabilities:
Increase in accounts receivable
Increase in inventories
Increase in accounts payable
Decrease in accrued expenses payable
Net cash flow from operating activities		$
Cash flows from (used for) investing activities:
Cash from the sale of investments	$
Cash used for the purchase of land
Cash used for the purchase of equipment
Net cash flow used for investing activities
Cash flows from (used for) financing activities:
Cash from the sale of common stock
Cash used for dividends
Net cash flow from financing activities
Increase in cash		$
Cash at the beginning of the year
Cash at the end of the year		$

Answer rating: 100% (QA)

Merrick Equipment Co Statement of Cash Flows For the Year Ended December 31 20Y9 Ca... View the full answer