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Statement of Cash Flows—Indirect Method The comparative balance sheet of Yellow Dog Enterprises Inc. at December...

Statement of Cash Flows—Indirect Method

The comparative balance sheet of Yellow Dog Enterprises Inc. at December 31, 20Y8 and 20Y7, is as follows:

Dec. 31, 20Y8 Dec. 31, 20Y7
Assets
Cash $74,770 $92,010
Accounts receivable (net) 114,890 124,040
Merchandise inventory 164,120 153,730
Prepaid expenses 6,690 4,660
Equipment 334,330 275,450
Accumulated depreciation-equipment (86,930) (67,550)
Total assets $607,870 $582,340
Liabilities and Stockholders' Equity
Accounts payable (merchandise creditors) $127,650 $121,710
Mortgage note payable 0 174,700
Common stock, $1 par 19,000 12,000
Paid-in capital: Excess of issue price over par-common stock 269,000 164,000
Retained earnings 192,220 109,930
Total liabilities and stockholders’ equity $607,870 $582,340

Additional data obtained from the income statement and from an examination of the accounts in the ledger for 20Y8 are as follows:

  1. Net income, $210,660.
  2. Depreciation reported on the income statement, $42,240.
  3. Equipment was purchased at a cost of $81,740, and fully depreciated equipment costing $22,860 was discarded, with no salvage realized.
  4. The mortgage note payable was not due for six years, but the terms permitted earlier payment without penalty.
  5. 7,000 shares of common stock were issued at $16 for cash.
  6. Cash dividends declared and paid, $128,370.

Required:

Prepare a statement of cash flows, using the indirect method. Use the minus sign to indicate cash outflows, cash payments, decreases in cash, or any negative adjustments.

Yellow Dog Enterprises Inc.
Statement of Cash Flows
For the Year Ended December 31, 20Y8
Cash flows from operating activities:
$
Adjustments to reconcile net income to net cash flow from operating activities:
Changes in current operating assets and liabilities:
Net cash flow from operating activities $
Cash flows from (used for) investing activities:
$
Net cash flow used for investing activities
Cash flows from (used for) financing activities:
$
Net cash flow used for financing activities
$
Cash at the beginning of the year
Cash at the end of the year $
Business   Accounting   
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