For the current year, a firm reported net income from operations of $20,000 on its income statement and an increase of $30,000 in cash from operations on the statement of cash flows. Explain some likely reasons for the greater increase in cash from operations than net income from operations.

For the current year, a firm reported net income from operations of $20,000 on its income statement and an increase of $30,000 in cash from operations on the statement of cash flows. Explain some likely reasons for the greater increase in cash from operations than net income from operations.

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

Chapter21: The Statement Of Cash Flows

Section: Chapter Questions

Problem 5RE: In the current year, Harrisburg Corporation had net income of 35,000, a 9,000 decrease in accounts...

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In the current year, Harrisburg Corporation had net income of 35,000, a 9,000 decrease in accounts receivable, a 7,000 increase in inventory, an 8,000 increase in salaries payable, a 13,000 decrease in accounts payable, and 10,000 in depreciation expense. Using the indirect method, prepare the operating activities section of its statement of cash flows based on this information.
Analysis reveals that a company had a net increase in cash of $21,540 for the current year. Net cash provided by operating activities was $19,400; net cash used in investing activities was $10,700 and net cash provided by financing activities was $12,840. If the year-end cash balance is $26,100, the beginning cash balance was: $47,640. $16,980. $4,560. $42,080. $43,080.
The cash flows from operating activities are reported by the direct method on the statement of cash flows. Determine the following: a. If sales for the current year were $375,000 and accounts receivable increased by $29,000 during the year, what was the amount of cash received from customers?$fill in the blank 1 b. If income tax expense for the current year was $39,000 and income tax payable decreased by $21,000 during the year, what was the amount of cash payments for income tax?$fill in the blank 2
The cash flows from (used for) operating activities are reported by the direct method on the statement of cash flows. Determine the following: a. If sales for the current year were $558,800 and accounts receivable decreased by $39,700 during the year, what was the amount of cash received from customers?$fill in the blank 1 b. If income tax expense for the current year was $38,900 and income tax payable decreased by $4,500 during the year, what was the amount of cash paid for income taxes?$fill in the blank 2 c. Briefly explain why the cash received from customers in part (a) is different from sales.Because the customers paid than the amount of sales for the period, cash received from customers sales made on account by $39,700 during the current year.
Last year Lawsby Company reported sales of P120,000 on its income statement. During the year, accounts receivable increased by P10,000 and accounts payable increased by P15,000. The company uses the direct method to determine the net cash provided by operating activities on the statement of cash flows. The sales revenue adjusted to a cash basis for the year would be:
Cash Flows from Operating Activities-Direct Method The cash flows from operating activities are reported by the direct method on the statement of cash flows. Determine the following: a. If sales for the current year were $607,300 and accounts receivable decreased by $38,900 during the year, what was the amount of cash received from customers? b. If income tax expense for the current year was $57,900 and income tax payable decreased by $7,500 during the year, what was the amount of cash payments for income taxes? c. Briefly explain why the cash received from customers in part (a) is different from sales. Because the customers paid than the amount of sales for the period, cash received from customers sales made on account by $38,900 during the current year.
Using the Exhibit below, assume that the balance of Accounts Receivable was $61,000 at the beginning of the current year. Furthermore, assume that the balance of Accounts Receivable is $62,000 at the end of the current year. When preparing the Statement of Cash Flow using the indirect method for the current year, which of the following statements would describe the proper presentation of accounts receivable on the Cash flow from operating activities section? EXHIBIT Increase (Decrease) Net Income (loss) $XXX Adjustments to reconcile net income to net cash flow from operating activities: Depreciation of fixed assets XXX Losses on disposal of assets XXX Gains on…
In preparing a company's statement of cash flows for the most recent year using the indirect method, the following information is available: Net income for the year was $ 54,000Accounts payable decreased by 21,000Accounts receivable increased by 28,000Inventories increased by 8,000Depreciation expense was 30,000 What is the Net cash provided by operating activities ?
In preparing a company's statement of cash flows for the most recent year using the indirect method, the following information is available: Net income for the year was $ 56,500 Accounts payable decreased by 22,500 Accounts receivable increased by 29,500 Inventories increased by 9,500 Cash dividends paid were 14,900 Depreciation expense was 24,500 Net cash provided by operating activities was:
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Using the Exhibit below, assume that the balance of Accounts Payable was $60,000 at the beginning of the current year. Furthermore, assume that the balance of Accounts Payable is $65,000 at the end of the current year. When preparing the Statement of Cash Flow using the indirect method for the current year, which of the following statements would describe the proper presentation of accounts payable on the Cash flow from operating activities section? EXHIBIT Increase (Decrease) Net Income (loss) $XXX Adjustments to reconcile net income to net cash flow from operating activities: Depreciation of fixed assets XXX Losses on disposal of assets XXX Gains on disposal of…
Cash Flows from (Used for) Operating Activities-Direct Method The cash flows from (used for) operating activities are reported by the direct method on the statement of cash flows. Determine the following: a. If sales for the current year were $668,000 and accounts receivable decreased by $37,400 during the year, what was the amount of cash received from customers? b. If income tax expense for the current year was $54,900 and income tax payable decreased by $6,600 during the year, what was the amount of cash paid for income taxes? c. Briefly explain why the cash received from customers in part (a) is different from sales. Because the customers paid exceeded is less than than the amount of sales for the period, cash received from customers sales made on account by $37,400 during the current year. Previous Next >