KU Statement of Cash Flows Indirect Method Exercise

Problem

21-16

(Algo)

Statement

of

cash

flows;

indirect

method

[LO21-4,

21-8]

The

comparative

balance

sheets

for

2

0

24

and

2023

and

the statement of income for 2024 are given below for Dux Company. Additional information from Dux’s accounting records is provided also.

20242023AssetsCash

Accounts receivable

Less: Allowance for uncollectible accounts

Dividends receivable

Inventory

65.0

Long-term investment

Land

Buildings and equipment

Less: Accumulated depreciation

LiabilitiesAccounts payable

$ 35.0

Salaries payable17.0

Interest payable

17.0

Income tax payable

23.0

Notes payable

0

Bonds payable

Less: Discount on bonds

(3.0)

Shareholders’ EquityCommon stock

Paid-in capital—excess of par

20.0

Retained earnings

20.0

Less: Treasury stock(8.0)0$ 542.0$ 384.0

	DUX COMPANY
Comparative Balance Sheets
December 31, 2024 and 2023
	($ in thousands)
$ 1	2	3.0		$ 35.0
63.0		65.0
(4.0)		(3.0)
	18.0			17.0
70.0
30.0	25.0
85.0	40.0
165.0	265.0
	(8.0)	(125.0)
	$ 542.0		$ 384.0
$ 28.0
		20.0
19.0
22.0
45.0
92.0	52.0
(2.0)
210.0	200.0
24.0
95.0

DUX COMPANY

($ in thousands)

RevenuesSales revenue

Dividend revenue18.0

ExpensesCost of goods sold

Salaries expense

Depreciation expense3.0Bad debt expense

Interest expense

Loss on sale of building

Income tax expense

Net income

Income Statement
For the Year Ended December 31, 2024
$ 425.0
$ 443.0
150.0
55.0
1.0
38.0
33.0
46.0	326.0
$ 117.0

Additional information from the accounting records:

1. A building that originally cost $160,000, and which was three-fourths depreciated, was sold for $7,000.
2. The common stock of Byrd Corporation was purchased for $5,000 as a long-term investment.
3. Property was acquired by issuing a 13%, seven-year, $45,000 note payable to the seller.
4. New equipment was purchased for $60,000 cash.
5. On January 1, 2024, bonds were sold at their $40,000 face value.
6. On January 19, Dux issued a 5% stock dividend (1,000 shares). The market price of the $10 par value common stock was $14 per share at that time.
7. Cash dividends of $28,000 were paid to shareholders.
8. On November 12, 12,500 shares of common stock were repurchased as treasury stock at a cost of $8,000.

Required:

Prepare the statement of cash flows for Dux Company using the indirect method.

Note: Amounts to be deducted should be indicated with a minus sign. Enter your answers in thousands (i.e., 10,000 should be entered as 10).