The following schedule relates the income statement with cash flows from operating activities, derived by both the direct and indirect methods. The amounts for income statement elements are missing. Cash Flows from Operating Activities Indirect Method Direct Method Income Statement Net income Adjustment: Sales Cost of goods sold Decrease in accounts receivable $? Increase in inventory Cash received from customers $ 655 15 (30) ( 43) Cash paid to suppliers Cash paid to employees (Not reported-no cash effect) Cash paid for insurance (Not reported-no cash effect) Cash paid for income taxes Decrease in accounts payable Increase in salaries payable Salaries expense (457) 16 22 (41) Depreciation expense Depreciation expense Insurance expense Loss on sale of land Income tax expense Decrease in prepaid insurance Loss on sale of land Increase in income tax payable Net cash flows from operating activities 23 (19) 19 19 $ 99 Net cash flows from operating activities (39) $ 99 Net income $?

The following schedule relates the income statement with cash flows from operating activities, derived by both the direct and indirect methods. The amounts for income statement elements are missing. Cash Flows from Operating Activities Indirect Method Direct Method Income Statement Net income Adjustment: Sales Cost of goods sold Decrease in accounts receivable $? Increase in inventory Cash received from customers $ 655 15 (30) ( 43) Cash paid to suppliers Cash paid to employees (Not reported-no cash effect) Cash paid for insurance (Not reported-no cash effect) Cash paid for income taxes Decrease in accounts payable Increase in salaries payable Salaries expense (457) 16 22 (41) Depreciation expense Depreciation expense Insurance expense Loss on sale of land Income tax expense Decrease in prepaid insurance Loss on sale of land Increase in income tax payable Net cash flows from operating activities 23 (19) 19 19 $ 99 Net cash flows from operating activities (39) $ 99 Net income $?

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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