Financial Accounting
9th Edition
ISBN: 9781259738692
Author: Libby
Publisher: MCG
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Chapter 12, Problem 12.8E
Reporting and Interpreting
Rodriguez Company completed its income statement and comparative
| Income Statement for Current Year | ||
| Service revenue | $54,000 | |
| Expenses | ||
| Salaries | $46,000 | |
| 4,500 | ||
| Amortization of copyrights | 200 | |
| Other expenses | 9,700 | 60,400 |
| Net loss | $ (6,400) | |
| $ 8,000 | $13,000 | |
| Salaries payable | 12,000 | 1,000 |
| Other accrued liabilities | 1,000 | 2,800 |
In addition, Rodriguez bought a small service machine for $5,000.
Required:
- 1. Present the operating activities section of the statement of cash flows for Rodriguez Company using the indirect method.
- 2. What were the major reasons that Rodriguez was able to report a net loss but positive cash flow from operations? Explain why the reasons for the difference between cash flow from operations and net income are important to financial analysts.
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Rodriguez Company completed its income statement and comparative balance sheet for the current year and provided the following
information:
Income Statement for Current Year
Service revenue
Expenses
Salaries
Depreciation
Amortization of copyrights
Other expenses
Net loss
Partial Balance Sheet
Accounts receivable
Salaries payable
Other accrued liabilities
$ 42,000
8,200
220
10,200
Current Year
$ 9,300
13,000
1,500
Cash flows from operating activities:
RODRIGUEZ COMPANY
Statement of Cash Flows (Partial)
$ 53,000
60,620
$ (7,620)
Prior Year
$ 16,600
In addition, Rodriguez bought a small service machine for $7,000.
Required:
1.Present the operating activities section of the statement of cash flows for Rodriguez Company using the indirect method.
Note: List loss amount and cash outflows as negative amounts.
2,000
5,200
Fitz Company reports the following information Selected Annual Income Statement Data income $ Depreciation expense 44,000 Amortization expense7.200 Gain on sale of plant assets 6,000 Selected Year-End Balance Data Accounts receivable decrease $ Inventory decrease 42,000 Prepaid expenses increase 4,700 Accounts payable decrease8,200 Salaries payable increase 1,200 Use the indirect method to prepare the operating activities section of its statement of cash flows for the year ended December 31. (Amounts to be deducted should be indicated with a minus sign.)
Subject: acounting
Chapter 12 Solutions
Financial Accounting
Ch. 12 - Prob. 1QCh. 12 - Prob. 2QCh. 12 - Prob. 3QCh. 12 - What are the major categories of business...Ch. 12 - Prob. 5QCh. 12 - Prob. 6QCh. 12 - Prob. 7QCh. 12 - Prob. 8QCh. 12 - Compare the two methods of reporting cash flows...Ch. 12 - Prob. 10Q
Ch. 12 - Prob. 11QCh. 12 - What are noncash investing and financing...Ch. 12 - Prob. 13QCh. 12 - Prob. 1MCQCh. 12 - Prob. 2MCQCh. 12 - Prob. 3MCQCh. 12 - Prob. 4MCQCh. 12 - Prob. 5MCQCh. 12 - Prob. 6MCQCh. 12 - Prob. 7MCQCh. 12 - Prob. 8MCQCh. 12 - Prob. 9MCQCh. 12 - Prob. 10MCQCh. 12 - Prob. 12.1MECh. 12 - Determining the Effects of Account Changes on Cash...Ch. 12 - Prob. 12.3MECh. 12 - Prob. 12.4MECh. 12 - Prob. 12.5MECh. 12 - Prob. 12.6MECh. 12 - Prob. 12.7MECh. 12 - Prob. 12.1ECh. 12 - Prob. 12.2ECh. 12 - Prob. 12.3ECh. 12 - Prob. 12.4ECh. 12 - Prob. 12.5ECh. 12 - Prob. 12.6ECh. 12 - Prob. 12.7ECh. 12 - Reporting and Interpreting Cash Flows from...Ch. 12 - Prob. 12.9ECh. 12 - Prob. 12.10ECh. 12 - Prob. 12.11ECh. 12 - Inferring Balance Sheet Changes from the Cash Flow...Ch. 12 - (Chapter Supplement B) Computing and Reporting...Ch. 12 - During the period, Sanchez Company sold some...Ch. 12 - Prob. 12.15ECh. 12 - Prob. 12.16ECh. 12 - Prob. 12.17ECh. 12 - Prob. 12.18ECh. 12 - Prob. 12.19ECh. 12 - Prob. 12.20ECh. 12 - Prob. 12.21ECh. 12 - (Chapter Supplement A) Reporting and Interpreting...Ch. 12 - Prob. 12.23ECh. 12 - Prob. 12.24ECh. 12 - Prob. 12.1PCh. 12 - Prob. 12.2PCh. 12 - Prob. 12.3PCh. 12 - Prob. 12.4PCh. 12 - Prob. 12.5PCh. 12 - (Chapter Supplement C) Preparing a Statement of...Ch. 12 - Prob. 12.1APCh. 12 - Prob. 12.2APCh. 12 - Prob. 12.3APCh. 12 - Prob. 12.1CONCh. 12 - Prob. 12.1CPCh. 12 - Prob. 12.2CPCh. 12 - Prob. 12.3CPCh. 12 - Prob. 12.4CPCh. 12 - Prob. 12.5CPCh. 12 - Prob. 12.6CP
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