Powell Corporation's comparative statement of financial position are presented below. Additional information:
1. Net income was €27,900. Dividends declared and paid were €22,500.
2. All other changes in non-current account balances had a direct effect on cash flows, except the change in accumulated depreciation. The land was sold for €5,900.
Instruction
(a) Prepare a statement of cash flows for 2014 using the indirect method.
(b) Compute free cash flow.

Question

Powell Corporation's comparative statement of financial position are presented below.  Additional information:
1. Net income was €27,900. Dividends declared and paid were €22,500.
2. All other changes in non-current account balances had a direct effect on cash flows, except the change in accumulated depreciation. The land was sold for €5,900.
Instruction
(a) Prepare a statement of cash flows for 2014 using the indirect method.
(b) Compute free cash flow.

Quizplus · Accepted Answer

The Answer of Powell Corporation's comparative statement of financial position are presented below.  Additional information:
1. Net income was €27,900. Dividends declared and paid were €22,500.
2. All other changes in non-current account balances had a direct effect on cash flows, except the change in accumulated depreciation. The land was sold for €5,900.
Instruction
(a) Prepare a statement of cash flows for 2014 using the indirect method.
(b) Compute free cash flow.

Powell Corporation's Comparative Statement of Financial Position Are Presented Below