Answered: Prepare the operating activities…

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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The account balances for the non-cash current assets and current liabilities of Kid-game Software Inc. are as follows: December 31 2023 2022 Accounts receivable $ 117,000 $ 92,500 Inventory 83,200 105,000 Prepaid expenses 49,400 42,500 Totals $ 249,600 $ 240,000 Accounts payable $ 75,000 $ 57,500 Salaries payable 22,500 32,500 Interest payable 42,500 35,000 Totals $ 140,000 $ 125,000 During 2023, Kid-game Software Inc. reported depreciation expense of $47,000. All purchases and sales are on account. Profit for 2023 was $243,000. Required: 1. Prepare the operating activities section of the statement of cash flows using the indirect method. (List any deduction in cash and cash outflows as negative amounts.)

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