Consider the following information. 1. Service revenue for the year is $80,000. Of this amount, $70,000 is collected during the year and $10,000 is expected to be collected next year. 2. Salaries expense for the year is $40,000. Of this amount, $35,000 is paid during the year and $5,000 is expected to be paid next year. 3. Advertising expense for the year is $10,000. All of this amount is paid during the year. 4. Supplies expense for the year is $4,000. No supplies were purchased during the year. 5. Utility expense for the year is $12,000. Of this amount, $11,000 is paid during the year and $1,000 is expected to be paid next year. 6. Cash collected in advance from customers for services to be provided next year (Unearned revenue) is $2,000. Required: a. Calculate operating cash flows. b. Calculate net income.

Consider the following information. 1. Service revenue for the year is $80,000. Of this amount, $70,000 is collected during the year and $10,000 is expected to be collected next year. 2. Salaries expense for the year is $40,000. Of this amount, $35,000 is paid during the year and $5,000 is expected to be paid next year. 3. Advertising expense for the year is $10,000. All of this amount is paid during the year. 4. Supplies expense for the year is $4,000. No supplies were purchased during the year. 5. Utility expense for the year is $12,000. Of this amount, $11,000 is paid during the year and $1,000 is expected to be paid next year. 6. Cash collected in advance from customers for services to be provided next year (Unearned revenue) is $2,000. Required: a. Calculate operating cash flows. b. Calculate net income.

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter9: Current Liabilities And Contingent Obligations

Section: Chapter Questions

Problem 3RE: Cee Co.s fiscal year begins April 1. At the beginning of its fiscal year, Cee Co. estimates that...

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