Sherya Inc

question 33

Essay

Sherya Inc.'s policy is to report all cash flows arising from interest and dividends in the operating section. Sherya's activities for the year ended December 31, 2021 included the following:
• Interest expense for the period was $10,000. The interest payable account decreased $4,000.
• Made a $110,000 principal payment on a bank loan.
• Declared a $15,000 cash dividend payable on January 15, 2022.
• Declared and issued a stock dividend valued at $50,000.
• Paid $55,000 to repurchase ordinary shares and cancelled them. The book value was $40,000.
• Accounts payable increased $23,000 during the year.
• Issued $1,500,000 in bonds. The cash proceeds were $1,380,000.
Required:
a. Prepare the cash flows from financing activities section of the statement of cash flows.
b. Identify how the activities listed above that are not financing activities would be reported in the statement of cash flows assuming that the statement is prepared using the indirect method.

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Definitions:

Kubler-Ross

Refers to the Kubler-Ross model, also known as the five stages of grief, developed by Elisabeth Kübler-Ross involving denial, anger, bargaining, depression, and acceptance.

Stage Model

A theoretical framework that describes a sequence of phases through which individuals or processes pass over time.

Dying Individual

This term refers to a person who is in the process of approaching death, often considered in contexts of medical care, ethical discussions, or psychological support.

Integrity Vs. Despair

The final stage of Erik Erikson's theory of psychosocial development, where older adults reflect on their life and either attain a sense of fulfillment or experience despair over regrets.