BLUE SPRUCE CORPORATION Income Statement Year Ended November 30, 2018 Sales   $7,700,000 Cost of goods sold   4,550,000 Gross profit   3,150,000 Salaries expense   861,000 Operating expenses   213,000 Depreciation expense   89,000 Income before income tax   1,987,000 Income tax expense   247,000 Net income   $1,740,000 Additional information: 1.   Accounts receivable increased $390,000 during the year, and inventory decreased $530,000.   2.   Prepaid expenses, which relate to administrative expenses, increased $110,000 during the year.   3.   Accounts payable to suppliers of merchandise decreased $420,000 during the year.   4.   Accrued salaries payable decreased $140,000 during the year.   5.   Income tax payable increased $80,000 during the year.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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The income statement of Blue Spruce Corporation is presented here.

BLUE SPRUCE CORPORATION
Income Statement
Year Ended November 30, 2018
Sales   $7,700,000
Cost of goods sold   4,550,000
Gross profit   3,150,000
Salaries expense   861,000
Operating expenses   213,000
Depreciation expense   89,000
Income before income tax   1,987,000
Income tax expense   247,000
Net income   $1,740,000


Additional information:

1.   Accounts receivable increased $390,000 during the year, and inventory decreased $530,000.  
2.   Prepaid expenses, which relate to administrative expenses, increased $110,000 during the year.  
3.   Accounts payable to suppliers of merchandise decreased $420,000 during the year.  
4.   Accrued salaries payable decreased $140,000 during the year.  
5.   Income tax payable increased $80,000 during the year.  


(a)

Prepare the operating activities section of the statement of cash flows for the year ended November 30, 2018, for Blue Spruce Corporation using the indirect method. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).)

 
     
     
     
     
     
     
     
     
     
     
     
     
     
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