Condensed financial data of Waterway Company for 2020 and 2019 are presented below. WATERWAY COMPANY COMPARATIVE BALANCE SHEET AS OF DECEMBER 31, 2020 AND 2019 2020 2019 Cash $1,790 $1,150 Receivables 1,780 1,330 Inventory 1,620 1,890 Plant assets 1,930 1,700 Accumulated depreciation (1,200 ) (1,180 ) Long-term investments (held-to-maturity) 1,310 1,420 $7,230 $6,310 Accounts payable $1,210 $920 Accrued liabilities 210 240 Bonds payable 1,370 1,530 Common stock 1,860 1,670 Retained earnings 2,580 1,950 $7,230 $6,310 WATERWAY COMPANY INCOME STATEMENT FOR THE YEAR ENDED DECEMBER 31, 2020 Sales revenue $6,970 Cost of goods sold 4,680 Gross margin 2,290 Selling and administrative expenses 940 Income from operations 1,350 Other revenues and gains Gain on sale of investments 80 Income before tax 1,430 Income tax expense 540 Net income 890 Cash dividends 260 Income retained in business $630 Additional information: During the year, $70 of common stock was issued in exchange for plant assets. No plant assets were sold in 2020. Prepare a statement of cash flows using the direct method

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Condensed financial data of Waterway Company for 2020 and 2019 are presented below.

WATERWAY COMPANY COMPARATIVE BALANCE SHEET AS OF DECEMBER 31, 2020 AND 2019
	2020		2019
Cash	$1,790			$1,150
Receivables	1,780			1,330
Inventory	1,620			1,890
Plant assets	1,930			1,700
Accumulated depreciation	(1,200	)		(1,180	)
Long-term investments (held-to-maturity)	1,310			1,420
	$7,230			$6,310

Accounts payable	$1,210			$920
Accrued liabilities	210			240
Bonds payable	1,370			1,530
Common stock	1,860			1,670
Retained earnings	2,580			1,950
	$7,230			$6,310

WATERWAY COMPANY INCOME STATEMENT FOR THE YEAR ENDED DECEMBER 31, 2020
Sales revenue		$6,970
Cost of goods sold		4,680
Gross margin		2,290
Selling and administrative expenses		940
Income from operations		1,350
Other revenues and gains
Gain on sale of investments		80
Income before tax		1,430
Income tax expense		540
Net income		890
Cash dividends		260
Income retained in business		$630

Additional information:

During the year, $70 of common stock was issued in exchange for plant assets. No plant assets were sold in 2020.

Prepare a statement of cash flows using the direct method. (Show amounts in the investing and financing sections that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).)

During the year, $70 of common stock was issued in exchange for plant assets. No plant assets were sold in 2020.
Prepare a statement of cash flows using the direct method. (Show amounts in the investing and financing sections that decrease cash flow
with either a - sign e.g. -15,000 or in parenthesis eg (15,000),)
WATERWAY COMPANY
Statement of Cash Flows
(Direct Method)
2$

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