Question

A comparative balance sheet and an income statement for Burgess Company are given below: Burgess Company Comparative Balance Sheet (dollars in millions) Ending Beginning Balance Balance $ $ 141 858 69 940 800 1,809 1,805 950 855 $2.664 730 1,729 1,754 741 1,013 $2.742 Assets Current assets: Cash and cash equivalents Accounts receivable Inventory Total current assets Property, plant, and equipment Less accumulated depreciation Net property, plant, and equipment Total assets Liabilities and Stockholders' Equity Current liabilities: Accounts payable Accrued liabilities Income taxes payable Total current liabilities Bonds payable Total liabilities Stockholders' equity: Common stock Retained earnings Total stockholders' equity Total liabilities and stockholders' equity 320 $ 190 432 1,232 900 1,332 295 1,137 1,432 2,664 295 1,115 1.410 $2,742 Burgess Company Income Statement (dollars in millions) Sales Cost of goods sold Gross margin Selling and administrative expenses Net operating income Nonoperating items! Gain on sale of equipment Income before taxes Income taxes Net income $4,600 3,140 1,460 940 520 $ 350 Brous

Answer 1

Answer-

BURGESS COMPANY
STATEMENT OF CASH FLOWS (USING INDIRECT METHOD)
FOR THE YEAR ENDED
Particulars		Amount
		$ in millions
Cash flow from operating activities
Net Income		350
Adjustments to reconcile net income to net cash provided by operating activities
Adjustment for non cash effects
Depreciation	($950+$37-$741)	246
Gain on sale of equipment		-2
Change in operating assets & liabilities
Increase in accounts receivable		-82
Increase in inventory		-70
Increase in accounts payable		130
Increase in accrued liabilities		70
Increase in income taxes payable		35
Net cash flow from operating activities (a)		677
Cash Flow from Investing activities
New equipment purchased	($1805+$72-$1754)	-123
Old Equipment sold		37
Net cash Flow from Investing activities (b)		-86
Cash Flow from Financing activities
Cash dividends paid	($1115+350-$1137)	-328
Bonds payable paid		-335
Net cash Flow from Financing activities (c)		-663
Net Change in cash c=a+b+c		-72
Beginning cash balance		141
Closing cash balance		69