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vities: flows P1. Cash Flows from Operating Activities: Direct Method Tanucci Clothing Store's income statement follows. Net sales Cost of goods sold: Beginning inventory Net cost of purchases Goods available for sale Ending inventory Cost of goods sold Gross margin Tanucci Clothing Store Income Statement For the Year Ended June 30, 2014 Operating expenses: Sales and administrative salaries expense Other sales and administrative expenses Total operating expenses Income before income taxes Income taxes Net income $1,240,000 3,040,000 $4,280,000 1,400,000 $1,112,000 624,000 $4,900,000 2,880,000 $2,020,000 1,736,000 $ 284,000 78,000 $ 206,000 Additional information: (a) other sales and administrative expenses include depreciation expense of $104,000 and amortization expense of $36,000; (b) accrued liabilities for salaries were $24,000 less than the previous year, and prepaid expenses were $40,000 more than the previous year; and (c) during the year accounts receivable (net) increased by $288,000,

vities: flows P1. Cash Flows from Operating Activities: Direct Method Tanucci Clothing Store's income statement follows. Net sales Cost of goods sold: Beginning inventory Net cost of purchases Goods available for sale Ending inventory Cost of goods sold Gross margin Tanucci Clothing Store Income Statement For the Year Ended June 30, 2014 Operating expenses: Sales and administrative salaries expense Other sales and administrative expenses Total operating expenses Income before income taxes Income taxes Net income $1,240,000 3,040,000 $4,280,000 1,400,000 $1,112,000 624,000 $4,900,000 2,880,000 $2,020,000 1,736,000 $ 284,000 78,000 $ 206,000 Additional information: (a) other sales and administrative expenses include depreciation expense of $104,000 and amortization expense of $36,000; (b) accrued liabilities for salaries were $24,000 less than the previous year, and prepaid expenses were $40,000 more than the previous year; and (c) during the year accounts receivable (net) increased by $288,000,

FINANCIAL ACCOUNTING
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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Required: Using the direct method, prepare a schedule of cash flows from operating activities.

✔ Total operating activities: $47,600 inflows P1. Cash Flows from Operating Activities: Direct Method Tanucci Clothing Store's income statement follows. Net sales Cost of goods sold: Beginning inventory Net cost of purchases Goods available for sale Ending inventory Cost of goods sold Gross margin Tanucci Clothing Store Income Statement For the Year Ended June 30, 2014 Operating expenses: Sales and administrative salaries expense Other sales and administrative expenses Total operating expenses Income before income taxes Income taxes Net income $1,240,000 3,040,000 $4,280,000 1,400,000 $1,112,000 624,000 $4,900,000 2,880,000 $2,020,000 1,736,000 $ 284,000 78,000 $ 206,000 Additional information: (a) other sales and administrative expenses include depreciation expense of $104,000 and amortization expense of $36,000; (b) accrued liabilities for salaries were $24,000 less than the previous year, and prepaid expenses were $40,000 more than the previous year; and (c) during the year accounts receivable (net) increased by $288,000, accounts payable increased by $228,000, and income taxes payable decreased by $14,400.
Transcribed Image Text:✔ Total operating activities: $47,600 inflows P1. Cash Flows from Operating Activities: Direct Method Tanucci Clothing Store's income statement follows. Net sales Cost of goods sold: Beginning inventory Net cost of purchases Goods available for sale Ending inventory Cost of goods sold Gross margin Tanucci Clothing Store Income Statement For the Year Ended June 30, 2014 Operating expenses: Sales and administrative salaries expense Other sales and administrative expenses Total operating expenses Income before income taxes Income taxes Net income $1,240,000 3,040,000 $4,280,000 1,400,000 $1,112,000 624,000 $4,900,000 2,880,000 $2,020,000 1,736,000 $ 284,000 78,000 $ 206,000 Additional information: (a) other sales and administrative expenses include depreciation expense of $104,000 and amortization expense of $36,000; (b) accrued liabilities for salaries were $24,000 less than the previous year, and prepaid expenses were $40,000 more than the previous year; and (c) during the year accounts receivable (net) increased by $288,000, accounts payable increased by $228,000, and income taxes payable decreased by $14,400.
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