Question

Rojas Corporation's comparative balance sheets are presented below. 2019 ROJAS CORPORATION Comparative Balance Sheets December 31 2020 Cash $14,600 Accounts receivable 20,800 Land 19,800 Buildings 70,000 Accumulated depreciation-buildings (15,300) Total $109,900 $10,000 23,600 25,600 70,000 (10,900) $118,300 Accounts payable Common stock Retained earnings Total $12,100 74,900 22,900 $109,900 $27,800 71,000 19,500 $118,300 Additional information: 1. Net income was $22,600. Dividends declared and paid were $19,200. 2. No noncash investing and financing activities occurred during 2020. 3. The land was sold for cash of $4,500. (a) Prepare a statement of cash flows for 2020 using the indirect method. (Show amounts that decrease cash flow with either a - sign e.g. -15, 000, or in parenthesis e.g. (15,000).)

Answer 1

Cash flows from operating activities
Net income	$               22,600
Adjustments for:
Depreciation and amortization	$                  4,400
Loss on sale	$1,300.00
	$               28,300
Decrease in trade receivables	$2,800.00
Decrease in trade payables	($15,700.00)
	$               15,400
Cash generated from operations		$                   15,400
Cash flows from investing activities
Proceeds from sale of Land	$                  4,500
Net cash used in investing activities		$                     4,500
Cash flows from financing activities
Proceeds from issuance of Bonds	$                  3,900
Payment of Dividend	($19,200.00)
Net cash used in financing activities		$                 (15,300)
Net increase in cash and cash equivalents		$                     4,600
Cash and cash equivalents at beginning of period		$                   10,000
Cash and cash equivalents at end of period		$                   14,600

land A/c
By Balance		25600	To Cash		4500
			To Loss on sale		1300
			To Balance		19800