On Wellington's statement of cash flows, using the direct method, what amount will be shown for total net cash flow from operating activities? Assume Accrued Liabilities relate to Other Operating Expense. A) $(42,000) B) $58,000 C) $(58.000) D) $42.000

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
icon
Related questions
icon
Concept explainers
Topic Video
Question

J2

Wellington Company uses the direct method to prepare its statement of cash flows.
Refer to the following financial statement information for the year ended December 31,
2015:
Cash
Accounts Receivable
Inventory
PP&E, net
Total Assets
Wellington Inc.
Comparative Balance Sheet
December 31, 2015 and 2014
Accounts Payable
Accrued Liabilities
Long-term Notes Payable
Total Liabilities
Common Stock
Retained Earnings
Treasury Stock
Total Stockholders' Equity
Gain on Sale of Plant Assets
Total Revenues and Gains
Cost of Goods Sold
Salaries and Wages Expense
2014
2015
$33,000 $13,000
29,000 36,000
56,000
29,000
126,000
92,000
$244,000 $170,000
Depreciation Expense-Plant Assets
Other Operating Expense
Interest Expense
Income Tax Expense
Total Expenses
Net Income
$9,000 $13,000
7,000
3,000
70.000
79,000
$86,000 $95.000
Total Liabilities and Stockholders' Equity $244.000 $170.000
Sales Revenue
$291.300
Interest Revenue
1,000
6,000
$55,000 $3,000
115,000 78,000
(12.000) (6.000)
$158,000 $75,000
145,000
49,000
16,000
25,000
3.500
7,800
$298,300
246,300
$52,000
Increase/
(Decrease)
$20,000
(7,000)
27,000
34,000
$74.000
$(4,000)
4,000
(9,000)
$(9,000)
$52,000
37,000
(6.000)
$83,000
$74,000
4
On Wellington's statement of cash flows, using the direct method, what amount will be
shown for total net cash flow from operating activities? Assume Accrued Liabilities
relate to Other Operating Expense.
A) $(42,000) B) $58,000 C) $(58,000) D) $42,000
Transcribed Image Text:Wellington Company uses the direct method to prepare its statement of cash flows. Refer to the following financial statement information for the year ended December 31, 2015: Cash Accounts Receivable Inventory PP&E, net Total Assets Wellington Inc. Comparative Balance Sheet December 31, 2015 and 2014 Accounts Payable Accrued Liabilities Long-term Notes Payable Total Liabilities Common Stock Retained Earnings Treasury Stock Total Stockholders' Equity Gain on Sale of Plant Assets Total Revenues and Gains Cost of Goods Sold Salaries and Wages Expense 2014 2015 $33,000 $13,000 29,000 36,000 56,000 29,000 126,000 92,000 $244,000 $170,000 Depreciation Expense-Plant Assets Other Operating Expense Interest Expense Income Tax Expense Total Expenses Net Income $9,000 $13,000 7,000 3,000 70.000 79,000 $86,000 $95.000 Total Liabilities and Stockholders' Equity $244.000 $170.000 Sales Revenue $291.300 Interest Revenue 1,000 6,000 $55,000 $3,000 115,000 78,000 (12.000) (6.000) $158,000 $75,000 145,000 49,000 16,000 25,000 3.500 7,800 $298,300 246,300 $52,000 Increase/ (Decrease) $20,000 (7,000) 27,000 34,000 $74.000 $(4,000) 4,000 (9,000) $(9,000) $52,000 37,000 (6.000) $83,000 $74,000 4 On Wellington's statement of cash flows, using the direct method, what amount will be shown for total net cash flow from operating activities? Assume Accrued Liabilities relate to Other Operating Expense. A) $(42,000) B) $58,000 C) $(58,000) D) $42,000
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 3 steps with 3 images

Blurred answer
Knowledge Booster
Financial Statements
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education