Reference no: EM131705191

Question - Statement of Cash Flows-Indirect Method

The comparative balance sheet of Tru-Built Construction Inc. for December 31, 2014 and 2013, is as follows:

	Dec. 31, 2014	Dec. 31, 2013
Assets
Cash	$206	$69
Accounts receivable (net)	117	87
Inventories	74	48
Land	168	196
Equipment	94	76
Accumulated depreciation-equipment	(25)	(13)
Total	$634	$463
Liabilities and Stockholders' Equity
Accounts payable (merchandise creditors)	$80	$69
Dividends payable	13	-
Common stock, $10 par	42	22
Paid-in capital in excess of par-common stock	87	54
Retained earnings	412	318
Total	$634	$463

The following additional information is taken from the records:

1. Land was sold for $70.

2. Equipment was acquired for cash.

3. There were no disposals of equipment during the year.

4. The common stock was issued for cash.

5. There was a $136 credit to Retained Earnings for net income.

6. There was a $42 debit to Retained Earnings for cash dividends declared.

a. Prepare a statement of cash flows, using the indirect method of presenting cash flows from operating activities. Use the minus sign to indicate cash out flows, cash payments, decreases in cash and for any adjustments, if required.

b. Was Tru-Built Construction Inc.'s cash flow from operations more or less than net income?