Portions of the financial statements for Hawkeye Company are provided below. HAWKEYE COMPANY Income Statement For the Year Ended December 31, 2018 Sales Cost of goods sold Gross margin Operating expenses: Salaries Depreciation Loss on sale of land Total operating expenses Operating income Other income (expense): Gain on sale of cash equivalents Interest expense Income before tax Income tax expense Net income HAWKEYE COMPANY Selected Accounts from Comparative Balance Sheets December 31, 2018 and 2017 Year Cash Accounts receivable Inventory Accounts payable Salaries payable Interest payable Income taxes payable 2018 2017 $230 $209 404 439 878 859 219 252 189 206 59 122 $ 241 199 12 73 99 *** ****||| Change $ 21 (35) 19 (33) (17) 14 (23) Required: 1. Prepare the cash flows from operating activities section of the statement of cash flows for Hawkeye Company using the direct method. 2. Prepare the cash flows from operating activities section of the statement of cash flows for Hawkeye Company using the indirect method.

Portions of the financial statements for Hawkeye Company are provided below. HAWKEYE COMPANY Income Statement For the Year Ended December 31, 2018 Sales Cost of goods sold Gross margin Operating expenses: Salaries Depreciation Loss on sale of land Total operating expenses Operating income Other income (expense): Gain on sale of cash equivalents Interest expense Income before tax Income tax expense Net income HAWKEYE COMPANY Selected Accounts from Comparative Balance Sheets December 31, 2018 and 2017 Year Cash Accounts receivable Inventory Accounts payable Salaries payable Interest payable Income taxes payable 2018 2017 $230 $209 404 439 878 859 219 252 189 206 59 122 $ 241 199 12 73 99 * **||| Change $ 21 (35) 19 (33) (17) 14 (23) Required: 1. Prepare the cash flows from operating activities section of the statement of cash flows for Hawkeye Company using the direct method. 2. Prepare the cash flows from operating activities section of the statement of cash flows for Hawkeye Company using the indirect method.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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