Prepare a statement of cash flows using the indirect method. (Show amounts that

Question

Prepare a statement of cash flows 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).)

Presented below are the financial statements of Metlock Company Metlock Company Comparative Balance Sheets December 31 Assets 2017 2016 Cash $122,150 $69,800 Accounts receivable 69,800 48,860 Inventory 97,720 69,800 Property, plant, and equipment 209,400 272,220 Accumulated depreciation (111,680 (83,760 Total $387,390 $376,920 Liabilities and Stockholders' Equity Accounts payable 2 66,310 $ 52,350 Income taxes payable 24,430 27,920 Bonds payable 59,330 115,170 Common stock 62,820 48,860 Retained earnings 174,500 132,620 Total $387,390 $376,920

Explanation / Answer

Statement of cash flow :

Cash flow from operating activities Net income 111680 Adjustment to reconcile net income Depreciation expenses 61075 Increase account receivable (20940) Increase inventory (27920) Increase account payable 13960 Decrease income tax payable (3490) Net cash flow from operating activities 134365 Cash flow from investing activities Sale of property, plant and equipment 29665 Net Cash flow from investing activities 29665 Cash flow from Financing activities Retire bonds payable (55840) Issue common stock 13960 Dividend paid (69800) Net Cash flow from Financing activities (111680) Net cash flow 52350 Beginning cash 69800 Ending cash 122150

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