Question

It says that the numbers for cash recieved from sale of investments, cash paid for purchase of

land, cash paid for purchase of equipment, cash recieved from sale of common stock and cash paid for dividends is inocrrect. Can someone please check these?

Dec. 31, 2019 Dec. 31, 2018 Assets Cash $316,580 Accounts receivable (net) 114,680 323,750 $292,800 105,160 311,350 120,620 Inventories 0 166,050 Investments Land Equipment Accumulated depreciation-equipment 357,190 (83,620) $1,194,630 275,270 (74,230) $1,030,970 Total assets Liabilities and Stockholders' Equity Accounts payable (merchandise creditors) Accrued expenses payable (operating expenses) $203,100 26,810 9,280 Dividends payable Common stock, $10 par Paid-in capital in excess of par-common stock $216,230 21,500 11,950 64,510 242,510 637,930 $1,194,630 50,520 140,210 601,050 $1,030,970 Retained earnings Total liabilities and stockholders' equity Additional data obtained from an examination of the accounts in the ledger for 2049 are as follows:

Answer 1

Solution

Merrick Equipment Co.
Statement of Cash Flows
For the Year Ended December 31, 20Y9
Cash flows from operating activities:
Net income	$        85,340.00
Adjustments to reconcile net income to net cash flow from operating activities:
Depreciation	$          9,390.00
Loss on sale of investments	$       (20,510.00)
Changes in current operating assets and liabilities:
Increase in accounts receivable	$         (9,520.00)
Increase in inventories	$       (12,400.00)
Increase in accounts payable	$        13,130.00
Decrease in accrued expenses payable	$         (5,310.00)
Net cash flow from operating activities		$    60,120.00
Cash flows from (used for) investing activities:
Cash Received from sale of investments	$      141,130.00
Cash used for purchase of land	$     (166,050.00)
Cash used for purchase of equipment	$       (81,920.00)
Net cash flow used for investing activities		$ (106,840.00)
Cash flows from (used for) financing activities:
Cash received from sale of common stock	$      116,290.00
Cash used for dividends	$       (45,790.00)
Net cash flow from financing activities		$    70,500.00
Increase in cash		$    23,780.00
Cash at the beginning of the year		$ 292,800.00
Cash at the end of the year		$ 316,580.00