Statement of Cash Flows-Indirect Method The comparative balance sheet of Merrick Equipment
Co. for December 31, 2014 and 2013, is as follow Dec. 31, 2014 Dec. 31, 2013 Assets $70,720
207,230 298,520 0 295,800 438,600 (99,110) $1,211,760 47,940 188,190 289,850 102,000 0
358,020 (84,320) $901,680 Cash and Liabilities and Stockholders' Equity $ 205,700 30,600
25,500 202,000 354,000 393,960 $1,211,760 $194,140 26,860 20,400 102,000 204,000 354,280
$901,680 Paid-in capital: Excess of issue price over par-com s of issue price over par-common
stock Additional data obtained from an examination of the accounts in the ledger for 2014 are as
follows: a. Equipment and land were acquired for cash b. There were no disposals of equipment
during the year. c. The investments were sold for $91,800 cash d. The common stock was issued
for cash e. There was a $141,680 credit to Retained Earnings for net income f. There was a
$102,000 debit to Retained Earnings for cash dividends declared Required
Solution
cash flow from operating activities
cash receipt from custumer 2023898
cash paid to suppliers and employees 1964775
cash generated from operations 59123
income tax paid 94453
236133
net cash from operating activities 4378382
cash flow from investing activities
purchased investment 10200
land 295800
net cash used in investing activities 285600
cash flow from financing activities
dividend paid 25500
net cash from financing 25500
net increase in cash and cash eqivalent 22780
cash and cash eqivalent at beginning of the year 47940
cash and acsh eqivalent at the end of the year 70720