Cash Flows from Operating Activities-Indirect Method The net income reported on the income statement for the current year was $150,300. Depreciation recorded on store equipment for the year amounted to $24,800. Balances of the current asset and current liability accounts at the beginning and end of the year are as follows: End of Year Beginning of Year Cash $58,770 $54,070 Accounts receivable (net) 42,140 39,960 Merchandise inventory 57,540 60,830 Prepaid expenses 6,460 5,140 Accounts payable (merchandise creditors) 55,070 51,150 Wages payable 30,090 33,420 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 outflows, 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:
Cash Flows from Operating Activities-Indirect Method The net income reported on the income statement for the current year was $150,300. Depreciation recorded on store equipment for the year amounted to $24,800. Balances of the current asset and current liability accounts at the beginning and end of the year are as follows: End of Year Beginning of Year Cash $58,770 $54,070 Accounts receivable (net) 42,140 39,960 Merchandise inventory 57,540 60,830 Prepaid expenses 6,460 5,140 Accounts payable (merchandise creditors) 55,070 51,150 Wages payable 30,090 33,420 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 outflows, 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:
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter15: Statement Of Cash Flows
Section: Chapter Questions
Problem 5E: Cash flows from operating activitiesindirect method The net income reported on the income statement...
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