(SCF—Indirect Method, and Net Cash Flow from Operating Activities, Direct Method) Comparative…
(SCF—Indirect Method, and Net Cash Flow from Operating Activities, Direct Method) Comparative statement of financial position accounts of Marcus AG are presented below.
Additional data (ignoring taxes):
1. Net income for the year was €42,500.
2. Cash dividends declared and paid during the year were €21,125.
3. A 20% share dividend was declared during the year. €25,000 of retained earnings was capitalized.
4. Equity investments that cost €25,000 were sold during the year for €28,750.
5. Machinery that cost €3,750, on which €750 of depreciation had accumulated, was sold for €2,200.
Marcus’s 2022 income statement follows (ignoring taxes).
Instructions
a. Compute net cash flow from operating activities using the direct method.
b. Prepare a statement of cash flows using the indirect method.
