Question

Statement of Cash Flows—Indirect Method The comparative balance sheet of Olson-Jones Industries Inc. for December 31,...

Statement of Cash Flows—Indirect Method

The comparative balance sheet of Olson-Jones Industries Inc. for December 31, 20Y2 and 20Y1, is as follows:

Dec. 31, 20Y2 Dec. 31, 20Y1
Assets
Cash $197 $65
Accounts receivable (net) 113 81
Inventories 71 44
Land 161 183
Equipment 91 71
Accumulated depreciation-equipment (24) (12)
Total Assets $609 $432
Liabilities and Stockholders' Equity
Accounts payable (merchandise creditors) $77 $65
Dividends payable 12 -
Common stock, $1 par 40 20
Paid-in capital: Excess of issue price over par—common stock 93 51
Retained earnings 387 296
Total liabilities and stockholders' equity $609 $432

The following additional information is taken from the records:

  1. Land was sold for $55.
  2. Equipment was acquired for cash.
  3. There were no disposals of equipment during the year.
  4. The common stock was issued for cash.
  5. There was a $131 credit to Retained Earnings for net income.
  6. There was a $40 debit to Retained Earnings for cash dividends declared.

a. Prepare a statement of cash flows, using the indirect method of presenting cash flows from 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, 20Y2
Cash flows from operating activities:
$
Adjustments to reconcile net income to net cash flow from operating activities:
Changes in current operating assets and liabilities:
Net cash flow from operating activities $
Cash flows from (used for) investing activities:
$
Net cash flow from investing activities
Cash flows from (used for) financing activities:
$
Net cash flow from financing activities
$
Cash at the beginning of the year
Cash at the end of the year $

b. Was Olson-Jones Industries Inc.’s net cash flow from operations more or less than net income?

0 0
Add a comment Improve this question Transcribed image text
Answer #1

Answer-a)-

OLSON-JONES INDUSTRIES INC.
STATEMENT OF CASH FLOWS (USING INDIRECT METHOD)
FOR THE YEAR ENDED 31 DECEMBER,20Y2
Particulars Amount
$
Cash flow from operating activities
Net Income 131
Adjustments to reconcile net income to net cash provided by operating activities
Adjustment for non cash effects
Depreciation 12
Gain on sale of land -33
Change in operating assets & liabilities
Increase in accounts receivable -32
Increase in inventory -27
Increase in accounts payable 12
Net cash flow from operating activities (a) 63
Cash Flow from Investing activities
New equipment purchased -20
Land sold 55
Net cash Flow from Investing activities (b) 35
Cash Flow from Financing activities
Cash dividends paid ($40-$12) -28
Common stock issued 62
Net cash Flow from Financing activities (c) 34
Net Change in cash c=a+b+c 132
Beginning cash balance 65
Closing cash balance 197

b)- Olson-Jones Industries Inc.’s net cash flow from operations was less than net income.

Add a comment
Know the answer?
Add Answer to:
Statement of Cash Flows—Indirect Method The comparative balance sheet of Olson-Jones Industries Inc. for December 31,...
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions
  • Statement of Cash Flows—Indirect Method The comparative balance sheet of Olson-Jones Industries Inc. for December 31,...

    Statement of Cash Flows—Indirect Method The comparative balance sheet of Olson-Jones Industries Inc. for December 31, 20Y2 and 20Y1, is as follows: Dec. 31, 20Y2 Dec. 31, 20Y1 Assets Cash $203 $65 Accounts receivable (net) 116 81 Inventories 73 44 Land 166 184 Equipment 93 71 Accumulated depreciation-equipment (25) (13) Total Assets $626 $432 Liabilities and Stockholders' Equity Accounts payable (merchandise creditors) $79 $65 Dividends payable 13 - Common stock, $10 par 41 20 Paid-in capital: Excess of issue price...

  • Statement of Cash Flows—Indirect Method The comparative balance sheet of Olson-Jones Industries Inc. for December 31,...

    Statement of Cash Flows—Indirect Method The comparative balance sheet of Olson-Jones Industries Inc. for December 31, 20Y2 and 20Y1, is as follows: Dec. 31, 20Y2 Dec. 31, 20Y1 Assets Cash $114 $36 Accounts receivable (net) 65 45 Inventories 41 25 Land 94 102 Equipment 53 39 Accumulated depreciation-equipment (14) (7) Total Assets $353 $240 Liabilities and Stockholders' Equity Accounts payable (merchandise creditors) $44 $36 Dividends payable 7 - Common stock, $1 par 23 11 Paid-in capital: Excess of issue price...

  • Statement of Cash Flows—Indirect Method The comparative balance sheet of Olson-Jones Industries Inc. for December 31,...

    Statement of Cash Flows—Indirect Method The comparative balance sheet of Olson-Jones Industries Inc. for December 31, 20Y2 and 20Y1, is as follows: Dec. 31, 20Y2 Dec. 31, 20Y1 Assets Cash $193 $62 Accounts receivable (net) 110 77 Inventories 69 42 Land 158 175 Equipment 89 67 Accumulated depreciation-equipment (24) (12) Total Assets $595 $411 Liabilities and Stockholders' Equity Accounts payable (merchandise creditors) $75 $62 Dividends payable 12 - Common stock, $1 par 39 19 Paid-in capital: Excess of issue price...

  • Statement of Cash Flows—Indirect Method The comparative balance sheet of Olson-Jones Industries Inc. for December 31,...

    Statement of Cash Flows—Indirect Method The comparative balance sheet of Olson-Jones Industries Inc. for December 31, 20Y2 and 20Y1, is as follows: Dec. 31, 20Y2 Dec. 31, 20Y1 Assets Cash $192 $61 Accounts receivable (net) 109 76 Inventories 68 42 Land 156 172 Equipment 88 67 Accumulated depreciation-equipment (24) (12) Total Assets $589 $406 Liabilities and Stockholders' Equity Accounts payable (merchandise creditors) $74 $61 Dividends payable 12 - Common stock, $10 par 39 19 Paid-in capital: Excess of issue price...

  • Statement of Cash Flows—Indirect Method The comparative balance sheet of Olson-Jones Industries Inc. for December 31,...

    Statement of Cash Flows—Indirect Method The comparative balance sheet of Olson-Jones Industries Inc. for December 31, 20Y2 and 20Y1, is as follows: Dec. 31, 20Y2 Dec. 31, 20Y1 Assets Cash $136 $44 Accounts receivable (net) 78 55 Inventories 49 30 Land 112 127 Equipment 63 48 Accumulated depreciation-equipment (17) (9) Total Assets $421 $295 Liabilities and Stockholders' Equity Accounts payable (merchandise creditors) $53 $44 Dividends payable 8 - Common stock, $1 par 28 14 Paid-in capital: Excess of issue price...

  • Statement of Cash Flows—Indirect Method The comparative balance sheet of Olson-Jones Industries Inc. for December 31,...

    Statement of Cash Flows—Indirect Method The comparative balance sheet of Olson-Jones Industries Inc. for December 31, 20Y2 and 20Y1, is as follows: Dec. 31, 20Y2 Dec. 31, 20Y1 Assets Cash $183 $14 Accounts receivable (net) 55 49 Inventories 117 99 Land 250 330 Equipment 205 175 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 125 80 Paid-in capital in excess of par—common...

  • Statement of Cash Flows—Indirect Method The comparative balance sheet of Olson-Jones Industries Inc. for December 31,...

    Statement of Cash Flows—Indirect Method The comparative balance sheet of Olson-Jones Industries Inc. for December 31, 20Y2 and 20Y1, is as follows: Dec. 31, 20Y2 Dec. 31, 20Y1 Assets Cash $185 $60 Accounts receivable (net) 105 75 Inventories 66 41 Land 151 169 Equipment 85 65 Accumulated depreciation-equipment (23) (12) Total Assets $569 $398 Liabilities and Stockholders' Equity Accounts payable (merchandise creditors) $72 $60 Dividends payable 11 - Common stock, $1 par 38 19 Paid-in capital: Excess of issue price...

  • tatement of Cash Flows—Indirect Method The comparative balance sheet of Olson-Jones Industries Inc. for December 31,...

    tatement of Cash Flows—Indirect Method The comparative balance sheet of Olson-Jones Industries Inc. for December 31, 20Y2 and 20Y1, is as follows: Dec. 31, 20Y2 Dec. 31, 20Y1 Assets Cash $203 $66 Accounts receivable (net) 115 83 Inventories 72 46 Land 165 188 Equipment 93 72 Accumulated depreciation-equipment (25) (13) Total Assets $623 $442 Liabilities and Stockholders' Equity Accounts payable (merchandise creditors) $78 $66 Dividends payable 12 - Common stock, $10 par 41 21 Paid-in capital: Excess of issue price...

  • statement of Cash Flows-Indirect Method The comparative balance sheet of Olson-Jones Industries Inc. for December 31,...

    statement of Cash Flows-Indirect Method The comparative balance sheet of Olson-Jones Industries Inc. for December 31, 2012 and 2041, is as follows: Dec. 31, Dec. 31, 2011 Assets 2012 Cash $145 Accounts receivable (net) Inventories Land Equipment Accumulated depreciation equipment (18) Total Assets Liabilities and Stockholders' Equity Accounts payable (merchandise creditors) Dividends payable Common stock, $1 par Paid in capital: Excess of issue price over par- common stock Retained earnings Total liabilities and stockholders equity Total liabilities and stockholders' equity...

  • Statement of Cash Flows-Indirect Method The comparative balance sheet of Olson-Jones Industries Inc. for December 31,...

    Statement of Cash Flows-Indirect Method The comparative balance sheet of Olson-Jones Industries Inc. for December 31, 2012 and 2041, is as follows: Dec. 31, 2012 Dec. 31, 20Y1 Assets Cash Accounts receivable (net) Inventories Land Equipment 175 (42) Accumulated depreciation-equipment Total assets $625 Liabilities and Stockholders' Equity Accounts payable (merchandise creditors) Dividends payable Common stock, $1 par Pald-in capital: Excess of issue price over par- common stock Retained earnings Total liabilities and stockholders' equity 742 5625 The following additional information...

ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT