Question

The following information is available for Sweet Acacia Industries for the year ended December 31, 2022. $38,400 Beginning cash balance Accounts payable increase 9,120 Depreciation expense 65,600 Accounts receivable decrease 7,680 Inventory decrease 4,960 Net income 91,520 Cash received for sale of land at book value 166,400 Cash dividends paid 60,800 Income taxes payable decrease 6,240 129,600 Cash used to purchase land 105,600 Cash used to redeem bonds 256,000 Cash received from issuing stock
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 eg. (15,000).)

Answer 1

Answer:

                       Sweet Acacia Industries

                        Statement of Cash Flows  

               For the Year Ended December 31, 2022

Cash Flows from Operating Activities:  

Net income                                                                $91520

Adjustments to reconcile net income to

Net cash provided by operating activities

Depreciation expense                                65600  

Decrease in Accounts Receivable             7680

Decrease in inventory                                 4960

Increase in accounts payable                     9120

Decrease in Income tax payable               -6240     $81120

Net cash provided by operating activities             $172,640

Cash Flows from Investing Activities:

Sale of Land                                               166400  

Purchase of Land                                      -129600

Net Cash Provided by Investing Activities             $36,800

Cash Flows from Financing Activities:

Payment of Dividends                                -60800

Issuance of Stock                                       256000

Redemption of Bonds                                -105600

Net Cash provided by Financing Activities             $89,600

Net Increase in Cash                                                   $299,040

Cash at Beginning of Period                                      $38,400

Cash at End of Period                                                 $337,440