Comparative balance sheets for 2011 and 2010 and a statement of income for 2011 are given below for Metagrobolize Industries. Additional information from the accounting records of Metagrobolize also is provided.
Additional information from the accounting records:
a. During 2011, equipment with a cost of $300,000 (90% depreciated) was sold.
b. The statement of shareholders' equity reveals reductions of $225,000 and $450,000 for stock dividends and cash dividends, respectively.
Required:
Prepare the statement of cash flows of Metagrobolize for the year ended December 31, 2011. Present cash flows from operating activities by the direct method. (You may omit the schedule to reconcile net income to cash flows from operating activities.)