Presented below are data from the records of Metro Co. 2022 2021 Cash 15,000 8,000 Accounts receivable 85,000 60,000 Long-term investment 10,000 53,000 Machine and equipment 335,000 215,000 Building 500,000 0 Accumulated depreciation 20,000 40,000 Accounts payable 40,000 22,000 Bonds payable 75,000 0 Common stock 754,000 254,000 Retained earnings 56,000 20,000 Additional information: 1. Held-to-maturity securities (long-term investment) carried at a cost of $43,000 on December 31, 2021, were sold in 2022 for $34,000. 2. Equipment that cost $50,000 and 80% depreciated was sold in 2022 for $8,000. 3. Net income was $46,000 and $50,000 for 2022 and 2021, respectively. 4. Dividends paid amounted to $10,000. 5. A building was purchased at $500,000 on December 31, 2022 by issuing common stock at par 6. Transactions other than the purchase of a building were made in cash. Prepare a statement of cash flows for the year 2022. Use the indirect method for the operating activities. *Be sure to prepare the investing and financing activities as well.

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter11: The Statement Of Cash Flows

Section: Chapter Questions

Problem 55PSA

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Presented below are data from the records of Metro Co.
2022 2021
Cash 15,000 8,000
Accounts receivable 85,000 60,000
Long-term investment 10,000 53,000
Machine and equipment 335,000 215,000
Building 500,000 0
Accumulated depreciation 20,000 40,000
Accounts payable 40,000 22,000
Bonds payable 75,000 0
Common stock 754,000 254,000
Retained earnings 56,000 20,000
Additional information:
1. Held-to-maturity securities (long-term investment) carried at a cost of $43,000 on December 31, 2021,
were sold in 2022 for $34,000.
2. Equipment that cost $50,000 and 80% depreciated was sold in 2022 for $8,000.
3. Net income was $46,000 and $50,000 for 2022 and 2021, respectively.
4. Dividends paid amounted to $10,000.
5. A building was purchased at $500,000 on December 31, 2022 by issuing common stock at par

6. Transactions other than the purchase of a building were made in cash.
Prepare a statement of cash flows for the year 2022. Use the indirect method for the operating activities.
*Be sure to prepare the investing and financing activities as well.

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