Please help me answer Requirement 2. I have some of it completed. Show all work please (:
The following changes took place last year in Pavolik Company's balance sheet accounts:
Asset and Contra-Asset Accounts Cash and cash equivalents Accounts receivable Inventory
Liabilities and Stockholders Equity Accounts $14 D Accounts payable $44 I $18 I Accrued liabilities $18 D $46 D Income taxes payable $23 I $13 I Bonds payable $156 I $15 D Common stock $72 D $50 S Retained earnings $64 I $64 I
Long-term investments Property, plant, and equipment Accumulated depreciation
D = Decrease; I = Increase.
Long-term Investments that cost the company $15 were sold during the year for $34 and land that cost $33 was sold for $18. In addition, the company declared and paid $12 in cash dividends during the year. Besides the sale of land, no other sales or retirements of plant and equipment took place during the year. Pavolik did not retire any bonds during the year or issue any new common stock.
The company's income statement for the year follows:
Sales Cost of goods sold Gross margin Selling and administrative expenses Net operating income Nonoperating items: Loss on sale of land Gain on sale of investments Income before taxes Income taxes Net income
$840 $362 $478 $366 $118
$(15) $19
$4 $122 $46 $76
The company's beginning cash balance was $116 and its ending balance was $102.
Required: 1. Use the Indirect method to determine the net cash provided by operating activities for the year. 2. Prepare a statement of cash flows for the year.
Required 1
Required 2
Prepare a statement of cash flows for the year. (List any deduction in cash and cash outflows as negative amounts.)
Pavolik Company Statement of Cash Flows
Operating activities: Net cash provided by operating activities
Investing activities: Proceeds from sale of long-term investments Proceeds from sale of land
$200 $34
Additions to property, plant & equipment Net cash used in investing activities
$34
Financing activities: Purchase of common stock Cash dividends paid
($12)
Net cash provided by financing activities
($12)
$222 $116 $338
Beginning cash and cash equivalents Ending cash and cash equivalents
