The income statement of Pina Company is shown below. PINA COMPANY INCOMESTATEMENT FOR THE YEAR ENDED DECEMBER 31, 2020 Sales revenue Cost of goods sold Beginning inventory $6.880,000 $1.880,000 Purchases 4,440,000 6,320,000 Goods available for sale Ending inventory Cost of goods sold 1.620,000 4,700,000 Gross profit 2,180,000 Operating expenses Selling expenses Administrative expenses 460,000 700,000 1,160,000 $1.020.000 Net income Additional information: Accounts receivable decreased $380,000 during the year. 2 Prepaid expenses increased $150,000 during the year. Accounts payable to suppliers of merchandise decreased $250,000 during the year. Accrued expenses payable decreased $90,.000 during the year. Administrative expenses include depreciation expense of $50,000. 1. 3. 4. 5. Prepare the operating activities section of the statement of cash flows using the direct method.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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The income statement of Pina Company is shown below.
PINA COMPANY
INCOMESTATEMENT
FOR THE YEAR ENDED DECEMBER 31, 2020
Sales revenue
$6,880,000
Cost of goods sold
Beginning inventory
$1,880,000
Purchases
4,440.000
Goods available for sale
6,320,000
Ending inventory
Cost of goods sold
1,620,000
4,700,000
Gross profit
2,180,000
Operating expenses
Selling expenses
Administrative expenses
460,000
700,000
1,160,000
Net income
$1,020,000
Additional information:
1.
Accounts receivable decreased $380,000 during the year.
Prepaid expenses increased $150,000 during the year.
Accounts payable to suppliers of merchandise decreased $250,000 during the year.
2.
3.
4.
Accrued expenses payable decreased $90,000 during the year.
5.
Administrative expenses include depreciation expense of $50,000.
Prepare the operating activities section of the statement of cash flows using the direct method.
PINA COMPANY
Statement of Cash Flows (Partial)
24
>
Transcribed Image Text:The income statement of Pina Company is shown below. PINA COMPANY INCOMESTATEMENT FOR THE YEAR ENDED DECEMBER 31, 2020 Sales revenue $6,880,000 Cost of goods sold Beginning inventory $1,880,000 Purchases 4,440.000 Goods available for sale 6,320,000 Ending inventory Cost of goods sold 1,620,000 4,700,000 Gross profit 2,180,000 Operating expenses Selling expenses Administrative expenses 460,000 700,000 1,160,000 Net income $1,020,000 Additional information: 1. Accounts receivable decreased $380,000 during the year. Prepaid expenses increased $150,000 during the year. Accounts payable to suppliers of merchandise decreased $250,000 during the year. 2. 3. 4. Accrued expenses payable decreased $90,000 during the year. 5. Administrative expenses include depreciation expense of $50,000. Prepare the operating activities section of the statement of cash flows using the direct method. PINA COMPANY Statement of Cash Flows (Partial) 24 >
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