Preparation of statement of cash flows (format provided)
Comparative statements of financial position for Burgundy Bay Ltd. are shown below: Burgandy adheres to ASPE. Additional information concerning transactions and events during 2020:
1. Net income was $ 80,000.
2. Sold the long-term investments for $ 28,000.
3. Paid cash dividends of $ 34,000.
4. Purchased machinery costing $ 26,500, paid cash.
5. Purchased machinery by signing a $ 60,000 long-term note payable.
6. Extinguished a $ 40,000 long-term note payable by issuing common shares.
Instructions
Using the format provided on the next page, prepare a statement of cash flows (indirect method) for calendar 2020 for Burgundy Bay Ltd.

Question

Preparation of statement of cash flows (format provided)
Comparative statements of financial position for Burgundy Bay Ltd. are shown below: Burgandy adheres to ASPE.  Additional information concerning transactions and events during 2020:
1. Net income was $ 80,000.
2. Sold the long-term investments for $ 28,000.
3. Paid cash dividends of $ 34,000.
4. Purchased machinery costing $ 26,500, paid cash.
5. Purchased machinery by signing a $ 60,000 long-term note payable.
6. Extinguished a $ 40,000 long-term note payable by issuing common shares.
Instructions
Using the format provided on the next page, prepare a statement of cash flows (indirect method) for calendar 2020 for Burgundy Bay Ltd.

Quizplus · Accepted Answer

The Answer of Preparation of statement of cash flows (format provided)
Comparative statements of financial position for Burgundy Bay Ltd. are shown below: Burgandy adheres to ASPE.  Additional information concerning transactions and events during 2020:
1. Net income was $ 80,000.
2. Sold the long-term investments for $ 28,000.
3. Paid cash dividends of $ 34,000.
4. Purchased machinery costing $ 26,500, paid cash.
5. Purchased machinery by signing a $ 60,000 long-term note payable.
6. Extinguished a $ 40,000 long-term note payable by issuing common shares.
Instructions
Using the format provided on the next page, prepare a statement of cash flows (indirect method) for calendar 2020 for Burgundy Bay Ltd.

Preparation of Statement of Cash Flows (Format Provided)