The inventory decreased from year to year do you deduct or add for the cash flow statement. Please prepare cash flow statement so I can compare my answers **Statement of Cash Flow**The following image displays the financial statements for Lincoln Corporation as of year-end 2020 and 2019. This consolidated balance sheet is presented in thousands of dollars.**Assets****Current Assets:**- Cash: - 2020: $23,000 - 2019: $90,000- Marketable Securities: - 2020: $200,000 - 2019: $0- Accounts Receivable (Net): - 2020: $590,000 - 2019: $440,000- Inventory: - 2020: $587,000 - 2019: $615,000**Total Current Assets:**- 2020: $1,400,000- 2019: $1,145,000**Noncurrent Assets:**- Long-term Investments: - 2020: $310,000 - 2019: $390,000- Property & Equipment: - 2020: $1,800,000 - 2019: $1,100,000- Less: Accumulated Depreciation: - 2020 and 2019: ($500,000)- Property & Equipment (Net): - 2020: $1,300,000 - 2019: $600,000- Intangibles (Net): - 2020: $95,000 - 2019: $105,000**Total Noncurrent Assets:**- 2020: $1,705,000- 2019: $1,095,000**Total Assets:**- 2020: $3,105,000- 2019: $2,240,000This table serves as an example of how changes in assets are summarized year over year, providing insight into the financial health of the corporation. # Lincoln Corporation Financial Statements## Balance Sheet (as of Year-End)### Liabilities & Shareholders’ Equity**2020:**- **Accounts payable:** $890,000- **Short-term bank debt:** $190,000- **Total liabilities:** $1,080,000**2019:**- **Accounts payable:** $850,000- **Short-term bank debt:** $0- **Total liabilities:** $850,000### Shareholders' Equity**2020:**- **Common stock, $10 par value:** $775,000- **Additional paid-in capital:** $380,000- **Retained earnings:** $870,000- **Total shareholders’ equity:** $2,025,000**2019:**- **Common stock, $10 par value:** $675,000- **Additional paid-in capital:** $300,000- **Retained earnings:** $415,000- **Total shareholders’ equity:** $1,390,000**Total Liabilities & Shareholders’ Equity:**- **2020:** $3,105,000- **2019:** $2,240,000## Consolidated Income Statement (For Year Ended)### Revenues and Expenses- **Revenues:** - 2020: $1,448,000 - 2019: $1,200,000- **Cost of goods sold:** - 2020: $513,000 - 2019: $420,000- **Gross margin:** - 2020: $935,000 - 2019: $780,000- **Selling, general & administrative expenses:** - 2020: $150,000 - 2019: $120,000- **Operating income:** - 2020: $785,000 - 2019: $660,000- **Gain on sale of investments:** - 2020: $70,000 - 2019: $0- **Net income before taxes:** - 2020: $855,000 - 2019: $660,000- **Income taxes:** - 2020: $50,000 - 201

Statement of cash flows is one of the financial statement of the business, which shows all cash…

As of Year-End ($ thousands) 2020 2019 Liabilities & Shareholders' Equity Accounts payable ..... Short-term bank debt $ 890,000 190,000 $ 850,000 Total liabilities.... 1,080,000 850,000 Shareholders' equity Common stock, $10 par value Additional paid-in-capital. . . . . Retained earnings. ... $ 675,000 $ 775,000 380,000 870,000 .. 300,000 415,000 Total shareholders' equity 2,025,000 1,390,000 Total liabilities & shareholders' equity $3,105,000 $2,240,000 LINCOLN CORPORATION Consolidated Income Statement For Year Ended ($ thousands) 2020 2019 Revenues.... Less: Cost of goods sold $1,448,000 513,000 $1,200,000 420,000 Gross margin .... Less: Selling, general & administrative expenses 935,000 780,000 120,000 150,000 Operating income..... Gain on sale of investments .. 785,000 660,000 70,000 Net income before taxes. . . 660,000 11,000 855,000 .. Less: Income taxes. . . 50,000 Net income after taxes . . $ 805,000 $ 649,000 The footnotes to the Lincoln Corporation's financial statements revealed the following additional information: 1. Property and equipment costing $450 million was sold for its book value of $200 million. 2. Long-term investments were sold for $150 million, which included a gain of $70 million. Required Using the above financial data for the Lincoln Corporation, prepare the firm's statement of cash flow for 2020 using the indirect method. What does the company's statement of cash flow reveal about the business's aolth?

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q