Use the following income statement and balance sheet to determine the net cash provided by operating activities under the indirect method. Income Statement For Year Ended December 31, Year 2 Sales Cost of goods sold Depreciation expense Operating expenses (excluding depreciation) Other gains (losses) Gain on sale of equipment Income before taxes Income tax expense Net income $ 332,800 39,500 132,000 $ 523,500 (504,300) 6,500 $ 25,700 (6,100) $ 19,600

FINANCIAL ACCOUNTING
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Chapter1: Financial Statements And Business Decisions
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Use the following income statement and balance sheet to determine the net cash provided by operating activities under the
indirect method.
Sales:
Cost of goods sold
Depreciation expense
Operating expenses (excluding
depreciation)
Other gains (losses)
Gain on sale of equipment
Income before taxes
Income tax expense.
Net income
At December 31
Assets
Cash
Income Statement
For Year Ended December 31, Year 2
Total assets
Accounts receivable.
Inventory
Equipment
Accumulated depreciation Equipment.
Liabilities
Accounts payable
Income taxes payable.
Total liabilities
$ 332,800
39,500
132,000
Balance Sheets
www
$ 523,500
(504,300)
6,500
$ 25,700
(6,100)
$ 19,600
Year 2
$ 64,600
23,600
60,600
266,000
(110,000)
$ 304,800
$ 31,000
3,000
$ 34,000
Year 1
$ 57,100.
30,300
53,400
235,000
(102,500)
$ 273,300
$ 25,000
3,800
$ 28,800
Transcribed Image Text:Use the following income statement and balance sheet to determine the net cash provided by operating activities under the indirect method. Sales: Cost of goods sold Depreciation expense Operating expenses (excluding depreciation) Other gains (losses) Gain on sale of equipment Income before taxes Income tax expense. Net income At December 31 Assets Cash Income Statement For Year Ended December 31, Year 2 Total assets Accounts receivable. Inventory Equipment Accumulated depreciation Equipment. Liabilities Accounts payable Income taxes payable. Total liabilities $ 332,800 39,500 132,000 Balance Sheets www $ 523,500 (504,300) 6,500 $ 25,700 (6,100) $ 19,600 Year 2 $ 64,600 23,600 60,600 266,000 (110,000) $ 304,800 $ 31,000 3,000 $ 34,000 Year 1 $ 57,100. 30,300 53,400 235,000 (102,500) $ 273,300 $ 25,000 3,800 $ 28,800
At December 31
Assets
Cash
Accounts receivable
Inventory
Equipment
Accumulated depreciation Equipment
Total assets
Liabilities
Accounts payable
Income taxes payable
Total liabilities
Equity
Common stock
Paid-in Capital in excess of par value
Retained earnings
Total equity
Total liabilities and equity
Cash flows from operating activities
Balance Sheets
Adjustments to reconcile net income to net cash provided by
operating activities
Income statement items not affecting cash
Total liabilities
Equity
Common stock
Paid-in Capital in excess of par value
Retained earnings
Total equity
Total liabilities and equity
Cash flows from operating activities
Adjustments to reconcile net income to net cash provided by
operating activities
Income statement items not affecting cash
Changes in current assets and current liabilities
Year 2
$ 64,600
23,600
60,600
266,000
(110,000)
$ 304,800
$ 31,000
3,000
$ 34,000
$ 119,000
19,300
132,500
$ 270,800
$ 304,800
Year 1
$ 57,100
30,300
53,400
235,000
(182,500)
$ 273,300
$ 25,000
3,800
$ 28,800
$ 119,000
19,300
106, 200
$ 244,500
$ 273,300
$ 34,000
$ 119,000
19,300
132,500
$ 270,800
$ 304,800
$ 28,800
$ 119,000
19,300
106,200
$ 244,500
$ 273,300
Transcribed Image Text:At December 31 Assets Cash Accounts receivable Inventory Equipment Accumulated depreciation Equipment Total assets Liabilities Accounts payable Income taxes payable Total liabilities Equity Common stock Paid-in Capital in excess of par value Retained earnings Total equity Total liabilities and equity Cash flows from operating activities Balance Sheets Adjustments to reconcile net income to net cash provided by operating activities Income statement items not affecting cash Total liabilities Equity Common stock Paid-in Capital in excess of par value Retained earnings Total equity Total liabilities and equity Cash flows from operating activities Adjustments to reconcile net income to net cash provided by operating activities Income statement items not affecting cash Changes in current assets and current liabilities Year 2 $ 64,600 23,600 60,600 266,000 (110,000) $ 304,800 $ 31,000 3,000 $ 34,000 $ 119,000 19,300 132,500 $ 270,800 $ 304,800 Year 1 $ 57,100 30,300 53,400 235,000 (182,500) $ 273,300 $ 25,000 3,800 $ 28,800 $ 119,000 19,300 106, 200 $ 244,500 $ 273,300 $ 34,000 $ 119,000 19,300 132,500 $ 270,800 $ 304,800 $ 28,800 $ 119,000 19,300 106,200 $ 244,500 $ 273,300
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