Please help by being detailed. E23-11 (L02) (SCF-Indirect Method) Condensed fina

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Please help by being detailed.

E23-11 (L02) (SCF-Indirect Method) Condensed financial data of Pat Metheny Company for 2017 and 2016 are presented PAT METHENY COMPANY COMPARATIVE BALANCE SHEET AS OF DECEMBER 31, 2017 AND 2016 2016 $1,800 $1,150 Receivables 1,600 1,900 (1,200) 1,300 7,150 1,900 (1,170) investments 1,420 $6,300 $ 900 Accounts payable Accrued liabilities $1,200 Bonds payable Common stock 1,400 Retained earnings 2,450 1,900 7,150 $6,300 PAT METHENY COMPANY INCOME STATEMENT FOR THE YEAR ENDED DECEMBER 31, 2017 Sales revenue Cost of goods sold Gross margin Selling and administrative expense Income from operations Other revenues and gains $6,900 1,270 Gain on sale of investments Income before tax 1,350 Cash dividends Income retained in business $ 550 Additional information: During the year, $70 of common stock was issued in exchange for plant assets. No plant assets were sold in 2017 Instructions Prepare a statement of cash flows using the indirect method.

Explanation / Answer

Pat Metheny Company

STATEMENT OF CASH FLOWS

For the Year Ended December 31, 2008

(Indirect Method)

Non-cash financing and Investing activities

Issuance of common stock for plant assets = $70

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Pat Metheny Company

STATEMENT OF CASH FLOWS

For the Year Ended December 31, 2008

(Indirect Method)

Cash flow from Operating Activities Net Income $810 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation Expense ($1200 - $1170) $30 Gain on sale of investment ($80) Decrease in Inventory $300 Increase in accounts payable $300 Increase in receivables ($450) Decrease in accrued liabilities ($50) $50 Net cash provided by operating activities $860 Cash flow from Investing activities : Sale of held-to-maturity Investments [($1420 - $1300) + $80] $200 Purchase of plant assets [($1900 - $1700) - $70] ($130) Net cash provided by Investing activities $70 Cash flow from financing activities: Issuance of Capital Stock [($1900 - $1700) -$70] $130 Retirement of Bonds payable ($150) Payment of cash dividends ($260) Net cash used by financing activities $280 Net increase in cash $650 Cash, January 1, 2017 $1150 Cash, December 31, 2017 $1800

Non-cash financing and Investing activities

Issuance of common stock for plant assets = $70

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