The net income reported on the income statement for the current year was $152,300. Depreciation recorded on store equipment for the year amounted to $25,100. Balances of the current asset and current liability accounts at the beginning and end of the year are as follows: Line Item Description End of Year Beginning of Year Cash $61,530 $55,990 Accounts receivable (net) 44,120 41,380 Inventories 60,240 62,990 Prepaid expenses 6,770 5,320 Accounts payable (merchandise creditors) 57,650 52,970 Wages payable 31,500 34,600 Question Content Area a. Prepare the “Cash flows from (used for) operating activities” section of the statement of cash flows, using the indirect method. Use the minus sign to indicate cash outflows, cash payments, decreases in cash, or any negative adjustments. blankblank Line Item Description Amount Amount Cash flows from (used for) operating activities: $Net income Adjustments to reconcile net income to net cash flows from (used for) operating activities: Depreciation Changes in current operating assets and liabilities: Increase in accounts receivable Decrease in inventories Increase in prepaid expenses Increase in accounts payable Decrease in wages payable $Net cash flows from operating activities
The net income reported on the income statement for the current year was $152,300. Depreciation recorded on store equipment for the year amounted to $25,100. Balances of the current asset and current liability accounts at the beginning and end of the year are as follows: Line Item Description End of Year Beginning of Year Cash $61,530 $55,990 Accounts receivable (net) 44,120 41,380 Inventories 60,240 62,990 Prepaid expenses 6,770 5,320 Accounts payable (merchandise creditors) 57,650 52,970 Wages payable 31,500 34,600 Question Content Area a. Prepare the “Cash flows from (used for) operating activities” section of the statement of cash flows, using the indirect method. Use the minus sign to indicate cash outflows, cash payments, decreases in cash, or any negative adjustments. blankblank Line Item Description Amount Amount Cash flows from (used for) operating activities: $Net income Adjustments to reconcile net income to net cash flows from (used for) operating activities: Depreciation Changes in current operating assets and liabilities: Increase in accounts receivable Decrease in inventories Increase in prepaid expenses Increase in accounts payable Decrease in wages payable $Net cash flows from operating activities
Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
Chapter7: Operating Assets
Section: Chapter Questions
Problem 24CE
Related questions
Question
The net income reported on the income statement for the current year was $152,300.
Line Item Description | End of Year | Beginning of Year |
---|---|---|
Cash | $61,530 | $55,990 |
44,120 | 41,380 | |
Inventories | 60,240 | 62,990 |
Prepaid expenses | 6,770 | 5,320 |
Accounts payable (merchandise creditors) | 57,650 | 52,970 |
Wages payable | 31,500 | 34,600 |
Question Content Area
a. Prepare the “
Line Item Description | Amount | Amount |
---|---|---|
Cash flows from (used for) operating activities: | ||
|
$Net income | |
Adjustments to reconcile net income to net cash flows from (used for) operating activities: | ||
|
Depreciation | |
Changes in current operating assets and liabilities: | ||
|
Increase in accounts receivable | |
|
Decrease in inventories | |
|
Increase in prepaid expenses | |
|
Increase in accounts payable | |
|
Decrease in wages payable | |
|
$Net cash flows from operating activities |
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