Cash Flows from Operating Activities-Indirect Method The income statement disclosed the following items for the year: Depreciation expense $52,000 Gain on disposal of 30,330 equipment Net income 382,200 The changes in the current asset and liability accounts for the year are as follows: Increase (Decrease) Accounts receivable $8,100 Inventory (4,610) Prepaid insurance (1,730) Accounts payable (5,490) Income taxes payable 1,730 Dividends payable 1,210 a. Prepare the "Cash flows from operating activities" section of the statement of cash flows, using the indirect method. Use the minus sign to indicate cash out flows, cash payments, decreases in cash, or any negative adjustments. Statement of Cash Flows (partial) Cash flows from operating activities: Adjustments to reconcile net income to net cash flow from operating activities: Changes in current operating assets and liabilities: Net cash flow from operating activities

FINANCIAL ACCOUNTING
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Chapter1: Financial Statements And Business Decisions
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Cash Flows from Operating Activities-Indirect Method
The income statement disclosed the following items for the year:
Depreciation expense $52,000
Gain on disposal of
30,330
equipment
Net income
382,200
The changes in the current asset and liability accounts for the year are as follows:
Increase
(Decrease)
Accounts receivable
$8,100
Inventory
(4,610)
Prepaid insurance
(1,730)
Accounts payable
(5,490)
Income taxes payable
1,730
Dividends payable
1,210
a. Prepare the "Cash flows from operating activities" section of the statement of cash flows, using the indirect method. Use the minus sign to indicate cash out flows, cash payments, decreases in cash, or any negative
adjustments.
Statement of Cash Flows (partial)
Cash flows from operating activities:
Adjustments to reconcile net income to net cash flow from operating activities:
Changes in current operating assets and liabilities:
Net cash flow from operating activities
Transcribed Image Text:Cash Flows from Operating Activities-Indirect Method The income statement disclosed the following items for the year: Depreciation expense $52,000 Gain on disposal of 30,330 equipment Net income 382,200 The changes in the current asset and liability accounts for the year are as follows: Increase (Decrease) Accounts receivable $8,100 Inventory (4,610) Prepaid insurance (1,730) Accounts payable (5,490) Income taxes payable 1,730 Dividends payable 1,210 a. Prepare the "Cash flows from operating activities" section of the statement of cash flows, using the indirect method. Use the minus sign to indicate cash out flows, cash payments, decreases in cash, or any negative adjustments. Statement of Cash Flows (partial) Cash flows from operating activities: Adjustments to reconcile net income to net cash flow from operating activities: Changes in current operating assets and liabilities: Net cash flow from operating activities
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