FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Comparative balance sheets for 2024 and 2023 and a statement of income for 2024 are given below for Metagrobolize Industries. Additional information from the accounting records of Metagrobolize also is provided.

METAGROBOLIZE INDUSTRIES
Comparative Balance Sheets
December 31, 2024 and 2023
($ in thousands)
  2024 2023
Assets    
Cash $ 450 $ 160
Accounts receivable 490 260
Inventory 640 385
Land 650 590
Building 800 800
Less: Accumulated depreciation (250) (230)
Equipment 2,850 2,570
Less: Accumulated depreciation (472) (440)
Patent 1,700 1,950
  $ 6,858 $ 6,045
Liabilities    
Accounts payable $ 740 $ 440
Accrued liabilities 220 155
Lease liability—land 130 0
Shareholders' Equity    
Common stock 2,600 2,500
Paid-in capital—excess of par 600 515
Retained earnings 2,568 2,435
  $ 6,858 $ 6,045
METAGROBOLIZE INDUSTRIES
Income Statement
For the Year Ended December 31, 2024
($ in thousands)
Revenues    
Sales revenue $ 2,839  
Gain on sale of land 65 $ 2,904
Expenses    
Cost of goods sold 940  
Depreciation expense—building 20  
Depreciation expense—equipment 356  
Loss on sale of equipment 10  
Amortization of patent 250  
Operating expenses 600 2,176
Net income   $ 728

Additional information from the accounting records:

  1. Annual payments of $20,000 on the finance lease liability are paid each January 1, beginning in 2024.
  2. During 2024, equipment with a cost of $360,000 (90% depreciated) was sold.
  3. The statement of shareholders’ equity reveals reductions of $185,000 and $410,000 for stock dividends and cash dividends, respectively.

Required:

Prepare the statement of cash flows for Metagrobolize Industries using the indirect method.

Note: Enter your answers in thousands (i.e., 10,000 should be entered as 10).) Amounts to be deducted should be indicated with a minus sign.

 
 
 
 
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