METAGROBOLIZE INDUSTRIES
Spreadsheet for the Statement of Cash Flows
Dec.31 Changes Dec. 31
2017 Debits Credits 2018
Balance Sheet
Assets:
Cash 375 (14)205 580
Liabilities:
Accounts payable 450 (4)300 750
Problem 21–5
Shareholders’ Equity:
Common stock 3,000
(12)150 3,150
Income Statement
Revenues:
Expenses:
Cost of goods sold (4)600 (600)
Problem 21–5 (continued)
Spreadsheet for the Statement of Cash Flows
(continued)
Dec.31 Changes Dec. 31
2017 Debits Credits 2018
Statement of Cash Flows
Operating activities:
Cash inflows:
Investing activities:
Net cash flows (720)
Financing activities:
Net cash flows (470 )
Totals 8,155 8,155
X Noncash investing and financing activity.
Problem 21–5 (concluded)
METAGROBOLIZE INDUSTRIES
Statement of Cash Flows
For year ended December 31, 2018 ($ in 000)
Cash flows from operating activities:
Cash inflows:
From customers $2,495
Cash outflows:
Cash flows from investing activities:
Cash flows from financing activities:
Net increase in cash 205
Noncash investing and financing activities:
Requirement 1
Accounts receivable
revenue 150
Depreciation expense, bad debt expense, the gain on sale of equipment, and the
loss on sale of land are not cash outflows.
Problem 21–6
Problem 21–6 (concluded)
Requirement 2
Cash Flows from Operating Activities:
Cash received from customers $155
Cash paid to suppliers (87)
Net cash flows from
Cash Flows from Operating Activities:
Cash received from customers $316a
Cash increase from sale of cash equivalents 2b
Cash paid to suppliers (114)c
b.
Problem 21–7
The gain on sale of cash equivalents indicates that total cash increased as a result
of converting cash in one form (say a $10 million treasury bill) to cash in another
form (checking account)*:
[*Any other example you think of that involves a gain on sale of cash equivalents would work as well.]
Problem 21–7 (concluded)
Depreciation expense, patent amortization expense, the loss on sale of land, and
the gain on sale of investment are neither cash inflows nor outflows.
Direct Method
Cash Flows from Operating Activities:
Cash received from customers $692
Cash paid to suppliers (103)
Net cash flows from
Problem 21–8
Indirect Method
Cash Flows from Operating Activities:
Net income $ 88
Adjustments for noncash effects:
Changes in operating assets and liabilities:
Increase in accounts receivable (108)
Decrease in inventory 104
Direct Method
Cash Flows from Operating Activities:
Cash received from customers $926
Problem 21–9
Indirect Method
Cash Flows from Operating Activities:
Net income $ 40
Adjustments for noncash effects:
Changes in operating assets and liabilities:
Decrease in accounts receivable 26
1. Cash received from customers
$306
2. Cost of goods sold $180
3. ? in salaries payable Increase
Problem 21–10