Preparing the Operating Activities Section The data below were provided by the accounting records of Marshall Company. Net income (accrual basis) $50,000 Depreciation expense 6,000 Increase in salaries payable 1,000 Increase in trade accounts receivable 1,800 Decrease in merchandise inventory 2,300 Amortization of patent 200 10,000 25,000 300 Decrease in long-term liabilities Sale of capital stock for cash Amortization of discount on bonds payable Required Prepare the reconciliation of net income with cash flow from operations for inclusion in the statement of cash flows (indirect method). Note: If an item is not included in the operating activities section, leave the answer blank (zero). Cash flows from Operating Activities Net Income Adjustments: $ Depreciation expense Amortization expense-patent Amortization of discount on bonds payable Sale of capital stock for cash Increase in accounts receivable. Decrease in merchandise inventory Decrease in long-term liabilities Increase in salaries payable Net cash provided (used) by operating activities $

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Preparing the Operating Activities Section
The data below were provided by the accounting records of Marshall Company.
Net income (accrual basis)
$50,000
Depreciation expense
6,000
Increase in salaries payable
1,000
Increase in trade accounts receivable
1,800
Decrease in merchandise inventory
2,300
Amortization of patent
200
10,000
25,000
300
Decrease in long-term liabilities
Sale of capital stock for cash
Amortization of discount on bonds payable
Required
Prepare the reconciliation of net income with cash flow from operations for inclusion in the statement of cash flows (indirect method).
Note: If an item is not included in the operating activities section, leave the answer blank (zero).
Cash flows from Operating Activities
Net Income
Adjustments:
$
Depreciation expense
Amortization expense-patent
Amortization of discount on bonds payable
Sale of capital stock for cash
Increase in accounts receivable
Decrease in merchandise inventory
Decrease in long-term liabilities
Increase in salaries payable
Net cash provided (used) by operating activities $
Transcribed Image Text:Preparing the Operating Activities Section The data below were provided by the accounting records of Marshall Company. Net income (accrual basis) $50,000 Depreciation expense 6,000 Increase in salaries payable 1,000 Increase in trade accounts receivable 1,800 Decrease in merchandise inventory 2,300 Amortization of patent 200 10,000 25,000 300 Decrease in long-term liabilities Sale of capital stock for cash Amortization of discount on bonds payable Required Prepare the reconciliation of net income with cash flow from operations for inclusion in the statement of cash flows (indirect method). Note: If an item is not included in the operating activities section, leave the answer blank (zero). Cash flows from Operating Activities Net Income Adjustments: $ Depreciation expense Amortization expense-patent Amortization of discount on bonds payable Sale of capital stock for cash Increase in accounts receivable Decrease in merchandise inventory Decrease in long-term liabilities Increase in salaries payable Net cash provided (used) by operating activities $
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