Principles of Accounting Volume 1: Financial Accounting
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Prepare the Completed Statement of Cash Flows Using the Indirect Method
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Review Problem: Preparing the Virtual Co. Statement of Cash Flows
Figure 16.6 Comparative Balance Sheet. (attribution: Copyright Rice University, OpenStax, under CC BY-NC-SA 4.0 license)
Figure 16.7 Income Statement. (attribution: Copyright Rice University, OpenStax, under CC BY-NC-SA 4.0 license)
Additional Information
The following additional information is provided:
- Investments that originally cost $30,000 were sold for $47,500 cash.
- Investments were purchased for $50,000 cash.
- Plant assets were purchased for $66,000 cash.
- Cash dividends were declared and paid to shareholders in the amount of $8,000.
Directions:
Prepare the statement of cash flows (indirect method), for the year ended December 31, 2018.
Solution
Figure 16.8 Statement of Cash Flows. (attribution: Copyright Rice University, OpenStax, under CC BY-NC-SA 4.0 license)