Problem 12-7A Prepare a Statement of Cash Flows [LO12-1, LO12-2] [The following

Question

Problem 12-7A Prepare a Statement of Cash Flows [LO12-1, LO12-2]

[The following information applies to the questions displayed below.]

     During 2015, Weaver sold some equipment for $19 that had cost $31 and on which there was accumulated depreciation of $10. In addition, the company sold long-term investments for $12 that had cost $6 when purchased several years ago. A cash dividend was paid during 2015 and the company repurchased $36 of its own stock. Weaver did not retire any bonds during 2015.

Part 1

Using the indirect method, determine the net cash provided by/used by operating activities for 2015. (Negative amount should be entered with a minus sign.)

Part 2

Using the information in (1) above, along with an analysis of the remaining balance sheet accounts, prepare a statement of cash flows for 2015. (List any deduction in cash and cash outflows as negative amounts.)

Comparative financial statements for Weaver Company follow:

Explanation / Answer

1.

2.

Weaver Company Partial Statement of Cash Flows (Indirect Method) For the Year Ended December 31, 2015 Cash Flows from Operating Activities: Net income 63 Adjustments to reconcile net income to net cash provided by operations: Depreciation expense [86 - (72 - 10)] 24 Gain on sale of investments -6 Loss on sale of equipment 2 Increase in Accounts receivable -79 Decrease in Inventory 37 Increase in Prepaid expenses -3 Increase in Accounts payable 77 Decrease in Accrued liabilities -7 Increase in Income taxes payable 8 53 Net cash provided by operating activities 116

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