Preparing a Statement of Cash Flows
Metal Corporation acquired 75 percent ownership of Ocean Company on January 1, 20X1, at underlying book value. At that date, the fair value of the noncontrolling interest was equal to 25 percent of the book value of Ocean Company. Consolidated balance sheets at January 1, 20X3, and December 31, 20X3, are as follows:
Item | Jan. 1, 20X3 | Dec. 31, 20X3 |
Cash | $ 68,500 | $100,500 |
Accounts Receivable | 82,000 | 97,000 |
Inventory | 115,000 | 123,000 |
Land | 45,000 | 55,000 |
Buildings and Equipment | 515,000 | 550,000 |
Less: Accumulated Depreciation | (186,500) | (223,000) |
Patents | 5,000 | 4,000 |
Total Assets | $644,000 | $706,500 |
Accounts Payable | $ 61,000 | $ 66,000 |
Wages Payable | 26,000 | 20,000 |
Notes Payable | 250,000 | 265,000 |
Common Stock ($10 par value) | 150,000 | 150,000 |
Retained Earnings | 130,000 | 174,500 |
Noncontrolling Interest | 27,000 | 31,000 |
Total Liabilities and Owners’ Equity | $644,000 | $706,500 |
The consolidated income statement for 20X3 contained the following amounts:
Sales |
| $490,000 |
Cost of Goods Sold | $259,000 |
|
Wage Expense | 55,000 |
|
Depreciation Expense | 36,500 |
|
Interest Expense | 16,000 |
|
Amortization Expense | 1,000 |
|
Other Expenses | 39,000 | (406,500) |
Consolidated Net Income |
| $ 83,500 |
Income to Noncontrolling Interest |
| (9,000) |
Income to Controlling Interest |
| $ 74,500 |
Metal and Ocean paid dividends of $30,000 and $20,000, respectively, in 20X3.
Required
a.Prepare a worksheet to develop a consolidated statement of cash flows for 20X3 using the indirect method of computing cash flows from operations.
b.Prepare a consolidated statement of cash flows for 20X3.
We need at least 10 more requests to produce the solution.
0 / 10 have requested this problem solution
The more requests, the faster the answer.