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Comparative financial statements for Weaver Company follow:

During this year, Weaver sold some equipment for $18 that had cost $30 and on which there was accumulated depreciation of $10. In addition, the company sold long-term investments for $13 that had cost $6 when purchased several years ago. Weaver paid a cash dividend this year and the company repurchased $36 of its own stock. This year Weaver did not retire any bonds.

Required:

1. Using the indirect method, determine the net cash provided by/used in operating activities for this year. (List any deduction in cash and cash outflows as negative amounts.)

Weaver Company
Comparative Balance Sheet
at December 31 This Year Last Year Assets Cash $ 24 $ 12 Accounts receivable 306 229 Inventory 155 194 Prepaid expenses 8 6 Total current assets 493 441 Property, plant, and equipment 511 432 Less accumulated depreciation (85 ) (72 ) Net property, plant, and equipment 426 360 Long-term investments 26 32 Total assets $ 945 $ 833 Liabilities and Stockholders' Equity Accounts payable $ 303 $ 225 Accrued liabilities 73 80 Income taxes payable 74 63 Total current liabilities 450 368 Bonds payable 200 170 Total liabilities 650 538 Common stock 164 200 Retained earnings 131 95 Total stockholders’ equity 295 295 Total liabilities and stockholders' equity $ 945 $ 833

Explanation / Answer

Cash flows from Operating activities: Net income for the period 72.00 Adjustment required for reconciliation Gain on sale of Investment -7.00 Loss on sale of Equipment 2 Depreciation (72-10-85) 23 Increase in Accounts receivable -77 Decrease n Inventory 39.00 Increase in Pprepaid expense -2.00 Increase in Accounts payable 78 Decrease in Accrued liability -7 Increase in Income tax payable 11 Net cash provided from Operating activitites 132.00

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