Rojas corporation\'s comparative balance sheets are presented below. 1. Net inco

Question

Rojas corporation's comparative balance sheets are presented below.
1. Net income was $22,630. Dividends declared and paid were $19,500.
2. No noncash investing and financing activities occurred during 2019.
3. The land was sold for cash for $4,900.

From the postings in the accounts, indicate how the information is reported on a state- ment of cash flows using the indirect method. The loss on disposal of 57.000 Hint: Cost of equipment constructed is reported in the investing activities section as a decrease in cash of $53,000 plant assets was Prepare stemest of cash 128 Rojas Corporations comparative halance sheets are presented bl ROJAS CORPORATION Comparative Balance Sheets December 31 10 7,3 2019 14 300 10200 21.200 20.000 70,000 2018 Cash Aeccounts receivable Land Biui Accumulated depreciation-building 23 400 26.000 70.000 (1o.o00) $120,100 (15,000) $110.500 Accounts payable Commmon stock Retained earnings 12,370 75,000 23.130 31,100 69,000 20,000 $120,100 Total 5110,500 Additional information l. Net income was $22.630 Dividends declared and paid were $19 500 2. No noncash investing and financing activities occurred during 2019 3. The land was sold for cash ol $4,900 Insteuctions (a) Prepare a statement of cash flows for 2019 using the indirect method hi Compute free cash flow

Explanation / Answer

Bojas Corporation Cash Flow Statements Operating activities Net Income 22630 Add Non cash Expenses Depreciation on Building 5000 Loss on sale of land 1500 Increase/decrease in working capital Add Account recievables 2200 Less account payable -18730 Total cash flows from operations 12600 Investment Activities Sale of land 4500 Total cash flows from Investments 4500 Financial Activities Dividend paid -19500 Issue of common stock 6000 Total cash flows of Financial activities -13500 net Increase in cash and cash equvalents 3600 Cash And cash equivalents at beginning of period 10700 Cash and cash equivalents at end of period 14300

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