Quizzol

QUESTION:

Prepare a statement of cash flows using the indirect method. The income statement for

2023

and the balance sheets for

2023

and

2022

are presented for

Hoover

Industries, Inc.

View the income statement. View the balance sheets.

Requirement

Prepare a statement of cash flows for

Hoover

Industries, Inc., for the year ended December 31,

2023,

using the indirect method.

ANSWER:

Prepare the statement one section at a time. (Use parentheses or a minus sign for numbers to be subtracted and for net cash outflows.)

Hoover Industries, Inc.
Statement of Cash Flows (Indirect Method)
For the Year Ended December 31, 2023
Operating Activities:
Net income		$168,280
Adjustments to reconcile net income to cash basis:
Depreciation expense	$44,600
Gain on sale of plant asset	(2,000)
Increase in accounts payable	16,000
Increase in inventory	(109,000)
Increase in prepaid insurance	(5,500)
Decrease in accounts receivable	51,000
Decrease in wages payable	(1,300)
Increase in interest payable	1,600
Increase in taxes payable	52,620
Increase in other accrued expenses payable	2,600	50,620
Net cash provided by (used for) operating activities		218,900
Investing Activities:
Proceeds on sale of plant asset	4,200
Purchase of equipment	(50,800)
Purchase of new investments	(10,000)
Net cash provided by (used for) investing activities		(56,600)
Financing Activities:
Proceeds from bond issuance	42,500
Dividends paid	(11,300)
Repayment of long-term debt	(7,500)
Net cash provided by (used for) financing activities		23,700
Net increase (decrease) in cash		186,000
Cash, beginning of the year		291,000
Cash, end of the year		$477,000

Posted by Cleveland on September 5, 2024