Question

The following three accounts appear in the general ledger of Marin Inc. during 2022. Equipment Date...

The following three accounts appear in the general ledger of Marin Inc. during 2022.

Equipment
Date
Debit
Credit
Balance
Jan. 1
Balance
200,000
July 31
Purchase of equipment
87,500 287,500
Sept. 2
Cost of equipment constructed
66,250 353,750
Nov. 10
Cost of equipment sold
61,250 292,500
Accumulated Depreciation—Equipment
Date
Debit
Credit
Balance
Jan. 1
Balance
88,750
Nov. 10
Accumulated depreciation on equipment sold
20,000 68,750
Dec. 31
Depreciation for year
35,000 103,750
Retained Earnings
Date
Debit
Credit
Balance
Jan. 1
Balance
131,250
Aug. 23
Dividends (cash)
17,500 113,750
Dec. 31
Net income
90,000 203,750


From the postings in the accounts, indicate how the information is reported on a statement of cash flows using the indirect method. The loss on disposal of plant assets was $10,000. (Hint: Cost of equipment constructed is reported in the investing activities section as a decrease in cash of $66,250.) (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).)

Marin Inc.
Partial Statement of Cash Flows
Choose the accounting period                                                          December 31, 2022For the Year Ended December 31, 2022For the Quarter Ended December 31, 2022
Select an opening name for section one                                                          Cash at Beginning of PeriodCash at End of PeriodCash Flows from Financing ActivitiesCash Flows from Investing ActivitiesCash Flows from Operating ActivitiesNet Cash Provided by Financing ActivitiesNet Cash Provided by Investing ActivitiesNet Cash Provided by Operating ActivitiesNet Cash used by Financing ActivitiesNet Cash used by Investing ActivitiesNet Cash used by Operating ActivitiesNet Decrease in CashNet Increase in Cash
Select an item                                                          Construction of EquipmentDepreciation ExpenseGain on Disposal of Plant AssetsLoss on Disposal of Plant AssetsNet IncomePayment of Cash DividendsPurchase of EquipmentSale of Equipment
$Enter a dollar amount
Adjustments to reconcile net income to
Select an opening subsection name                                                          Cash at Beginning of PeriodCash at End of PeriodCash Flows from Financing ActivitiesCash Flows from Investing ActivitiesCash Flows from Operating ActivitiesNet Cash Provided by Financing ActivitiesNet Cash Provided by Investing ActivitiesNet Cash Provided by Operating ActivitiesNet Cash used by Financing ActivitiesNet Cash used by Investing ActivitiesNet Cash used by Operating ActivitiesNet Decrease in CashNet Increase in Cash
Select an item                                                          Construction of EquipmentDepreciation ExpenseGain on Disposal of Plant AssetsLoss on Disposal of Plant AssetsNet IncomePayment of Cash DividendsPurchase of EquipmentSale of Equipment
$Enter a dollar amount
Select an item                                                          Construction of EquipmentDepreciation ExpenseGain on Disposal of Plant AssetsLoss on Disposal of Plant AssetsNet IncomePayment of Cash DividendsPurchase of EquipmentSale of Equipment
Enter a dollar amount
Enter a total amount for this subsection
Select a closing name for section one                                                          Cash at Beginning of PeriodCash at End of PeriodCash Flows from Financing ActivitiesCash Flows from Investing ActivitiesCash Flows from Operating ActivitiesNet Cash Provided by Financing ActivitiesNet Cash Provided by Investing ActivitiesNet Cash Provided by Operating ActivitiesNet Cash used by Financing ActivitiesNet Cash used by Investing ActivitiesNet Cash used by Operating ActivitiesNet Decrease in CashNet Increase in Cash
Enter a total amount for section one
Select an opening name for section two                                                          Cash at Beginning of PeriodCash at End of PeriodCash Flows from Financing ActivitiesCash Flows from Investing ActivitiesCash Flows from Operating ActivitiesNet Cash Provided by Financing ActivitiesNet Cash Provided by Investing ActivitiesNet Cash Provided by Operating ActivitiesNet Cash used by Financing ActivitiesNet Cash used by Investing ActivitiesNet Cash used by Operating ActivitiesNet Decrease in CashNet Increase in Cash
Select an item                                                          Construction of EquipmentDepreciation ExpenseGain on Disposal of Plant AssetsLoss on Disposal of Plant AssetsNet IncomePayment of Cash DividendsPurchase of EquipmentSale of Equipment
Enter a dollar amount
Select an item                                                          Construction of EquipmentDepreciation ExpenseGain on Disposal of Plant AssetsLoss on Disposal of Plant AssetsNet IncomePayment of Cash DividendsPurchase of EquipmentSale of Equipment
Enter a dollar amount
Select an item                                                          Construction of EquipmentDepreciation ExpenseGain on Disposal of Plant AssetsLoss on Disposal of Plant AssetsNet IncomePayment of Cash DividendsPurchase of EquipmentSale of Equipment
Enter a dollar amount
Select a closing name for section two                                                          Cash at Beginning of PeriodCash at End of PeriodCash Flows from Financing ActivitiesCash Flows from Investing ActivitiesCash Flows from Operating ActivitiesNet Cash Provided by Financing ActivitiesNet Cash Provided by Investing ActivitiesNet Cash Provided by Operating ActivitiesNet Cash used by Financing ActivitiesNet Cash used by Investing ActivitiesNet Cash used by Operating ActivitiesNet Decrease in CashNet Increase in Cash
Enter a total amount for section two
Select an opening name for section three                                                          Cash at Beginning of PeriodCash at End of PeriodCash Flows from Financing ActivitiesCash Flows from Investing ActivitiesCash Flows from Operating ActivitiesNet Cash Provided by Financing ActivitiesNet Cash Provided by Investing ActivitiesNet Cash Provided by Operating ActivitiesNet Cash used by Financing ActivitiesNet Cash used by Investing ActivitiesNet Cash used by Operating ActivitiesNet Decrease in CashNet Increase in Cash
Select an item                                                          Construction of EquipmentDepreciation ExpenseGain on Disposal of Plant AssetsLoss on Disposal of Plant AssetsNet IncomePayment of Cash DividendsPurchase of EquipmentSale of Equipment
Enter a dollar amount

Homework Answers

Answer #1

Statement of Cash Flow :-

Particulars Amount($) Amount($)
Cash Flows from Operating Activities :-
Net Income 90000
Adjustments to reconcile net income to
Depreciation Expenses 35000
Loss on Disposal of plant 10000 45000
Net Cash Flows from operating Activities 135000
Cash Flows from Investing Activities :-
Sale of Plant Assets ($61250-$20000-$10000) 31250
Construction of Equipment (66250)
Purchase of Equipment (87500)
Net Cash Flows from investing Activities (122500) (122500)
Cash Flows from Financing Activities :-
Payment of Cash Dividends (17500)
Net Cash flows from Financing Activities (17500) (17500)
Net Change in Cash during the year ($135000-$122500-$17500) (5000)
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