Working Papers, Chapters 18-26 for Warren/Reeve/Duchacâs Accounting, 27E
27th Edition
ISBN: 9781337272162
Author: Reeve, James M., Duchac, Jonathan, WARREN, Carl S.
Publisher: South-Western College Pub
expand_more
expand_more
format_list_bulleted
Question
Chapter 16, Problem 16.1EX
To determine
Statement of
It is one of the financial statement that shows the cash, and cash equivalents of a company for a particular period. It determines the net changes in cash through reporting the sources and uses of cash due to the operating, investing, and financing activities of a company.
Cash flows from operating activities:
These refer to the cash received or cash paid in day-to-day operating activities of a company. In this direct method, cash flow from operating activities is computed by using all cash receipts, and cash payments during the year.
To explain: The apparent contradiction between the loss, and the positive cash flows.
Expert Solution & Answer
Trending nowThis is a popular solution!
Students have asked these similar questions
On its income statement for a recent year, American Airlines Group, Inc., the parent company of American Airlines, reported a net loss of $1,834 million from operations. On its statement of cash flows, it reported $675 million of cash flows from operating activities.Explain this apparent contradiction between the loss and the positive cash flows.
Cash flows from operating-net loss
On its income statement for a recent year, continental Airlines, Inc., reported a net loss of $471 million from operations. On its statement of flow, it reported $1,241 million of cash flows from operating activities.
Explain this apparent contradiction between the loss and the positive cash flows.
Volutia Corporation's comparative financial statements included the following amounts for the current year:
Depreciation expense
$102,000
Loss on sale of fixed assets
38,000
Decrease in fixed assets
155,000
Increase in accounts receivable
37,000
Decrease in accounts payable
42,000
Decrease in inventory
71,000
Increase in taxes payable
19,000
Net income
72,000
Compute net cash provided by operating activities using the indirect method.
Group of answer choices
$223,000
$68,000
$22,000
$185,000
Chapter 16 Solutions
Working Papers, Chapters 18-26 for Warren/Reeve/Duchacâs Accounting, 27E
Ch. 16 - Prob. 1DQCh. 16 - Prob. 2DQCh. 16 - A corporation issued 2,000,000 of common stock in...Ch. 16 - A retail business, using the accrual method of...Ch. 16 - Prob. 5DQCh. 16 - A long-term investment in bonds with a cost of...Ch. 16 - A corporation issued 2,000,000 of 20-year bonds...Ch. 16 - Fully depreciated equipment costing 50,000 is...Ch. 16 - Prob. 9DQCh. 16 - Name five common major classes of operating cash...
Ch. 16 - Prob. 16.1APECh. 16 - Prob. 16.1BPECh. 16 - Adjustments to net incomeindirect method Ripley...Ch. 16 - Prob. 16.2BPECh. 16 - Changes in current operating assets and...Ch. 16 - Changes in current operating assets and...Ch. 16 - Prob. 16.4APECh. 16 - Prob. 16.4BPECh. 16 - Land transactions on the statement of cash flows...Ch. 16 - Land transactions on the statement of cash flows...Ch. 16 - Prob. 16.6APECh. 16 - Prob. 16.6BPECh. 16 - Cash payments for merchandisedirect method The...Ch. 16 - Cash payments for merchandisedirect method The...Ch. 16 - Prob. 16.8APECh. 16 - Prob. 16.8BPECh. 16 - Prob. 16.1EXCh. 16 - Effect of transactions on cash flows State the...Ch. 16 - Classifying cash flows Identify the type of cash...Ch. 16 - Cash flows from operating activitiesindirect...Ch. 16 - Cash flows from operating activitiesindirect...Ch. 16 - Prob. 16.6EXCh. 16 - Prob. 16.7EXCh. 16 - Determining cash payments to stockholders The...Ch. 16 - Reporting changes in equipment on statement of...Ch. 16 - Prob. 16.10EXCh. 16 - Reporting land transactions on statement of cash...Ch. 16 - Prob. 16.12EXCh. 16 - Reporting land acquisition for cash and mortgage...Ch. 16 - Reporting issuance and retirement of longterm debt...Ch. 16 - Prob. 16.15EXCh. 16 - Prob. 16.16EXCh. 16 - Prob. 16.17EXCh. 16 - Statement of cash flowsindirect method The...Ch. 16 - Prob. 16.19EXCh. 16 - Prob. 16.20EXCh. 16 - Determining selected amounts for cash flows from...Ch. 16 - Prob. 16.22EXCh. 16 - Cash flows from operating activitiesdirect method....Ch. 16 - Prob. 16.24EXCh. 16 - Free cash flow The financial statement for Nike,...Ch. 16 - Free cash flow Lovato Motors Inc. has cash flows...Ch. 16 - Statement of cash flowsindirect method The...Ch. 16 - Prob. 16.2APRCh. 16 - Statement of cash flowsindirect method The...Ch. 16 - Prob. 16.4APRCh. 16 - Prob. 16.5APRCh. 16 - Prob. 16.1BPRCh. 16 - Statement of cash flowsindirect method The...Ch. 16 - Statement of cash flowsindirect method The...Ch. 16 - Statement of cash flowsdirect method The...Ch. 16 - Statement of cash flowsdirect method applied to PR...Ch. 16 - Ethics in Action Lucas Hunter, president of...Ch. 16 - Prob. 16.3CPCh. 16 - Using the statement of cash flows You are...Ch. 16 - Dillip Lachgar is the president and majority...
Knowledge Booster
Similar questions
- The Net Profit of LSLS Corporation for the year is $ 2,515,250. Using the following information in the table and find out the Net Cash Flows from Operating Activities by Indirect Method SI. No : Particulars Amount ($) 1 Depreciation Expense 25,565.00 Decrease in Current Liabilities 57,677.00 3 Increase in Prepaid Insurance 67,076.00 4 Loss on Sale of Machinery 322,387.00 Gain on sale of Non Current Asset 377,553.00 6 Increase in Salaries Payable 64,704.00 7 Provision for Taxation 123,321.00 $ 2,584,921 O $ 2,548,921 O $ 2,544,921 O $ 2,458,921arrow_forwardILoveFinance, Inc., provided the following financial information for the quarter ending September 30, 2006: Net income $241,463 Depreciation and amortization $133,414 Increase in receivables $102,709 Increase in accounts payables $62,411 Decrease in marketable securities $31,225 Increase in inventory $81,336 What is the cash flow from operating activities generated during this quarter by the firm? a. $253,243 b. -$308,458 c. $343,243 d. $374,468arrow_forwardBrandon, Inc. reported the following items in its balance sheet and income statement: Net Income $105,600 Gain on Disposal of Equipment 10,800 Increase in Accounts Receivable 6,200 Decrease in Accounts Payable 14,900 Increase in Common Stock 50,000 Based on this information, what is the cash flow from Operating Activities?arrow_forward
- The accounting records of Baddour Company provided the data below. $4,680 6,100 460 Net loss Depreciation expense Increase in salaries payable Decrease in accounts receivable Increase in inventory Amortization of patent Reduction in discount on bonds 1,900 2,350 340 240 Prepare a reconciliation of net income to net cash flows from operating activities. (Amounts to be deducted should be indicated with a minus sign.)arrow_forwardCarr Corporation's comparative balance sheet and income statement for last year appear below: Comparative Balance Sheet Ending Balance Beginning Balance Cash and cash equivalents $ 3,060 $ 25,070 Accounts receivable 88,000 77,390 Inventory 41,300 48,410 Prepaid expenses 9,810 16,500 Long-term investments 252,000 208,000 Property, plant, and equipment 566,500 489,600 Less accumulated depreciation 339,200 318,600 Total assets $ 621,470 $ 546,370 Accounts payable $ 9,180 $ 27,250 Accrued liabilities 25,680 17,850 Income taxes payable 53,900 50,600 Bonds payable 176,000 210,000 Common stock 152,000 140,000 Retained earnings 204,710 100,670 Total liabilities and stockholders' equity $ 621,470 $ 546,370 Income Statement Sales $ 926,500 Cost of goods sold 486,000 Gross margin 440,500 Selling and administrative expense 286,200 Net operating income 154,300 Income taxes 41,300 Net income $ 113,000 The company declared and paid…arrow_forwardNet income is $28,053. During the year, the company had $4,810 depreciation expense and a loss on sale of assets of $4,614. In addition, accounts receivable decreased $13,211 and taxes payable decreased $11,540. What is the net cash provided by operations under the indirect method? If the answer is a source, leave the number positive. If the answer is a use, put a negative sign "-" in front of your answer.arrow_forward
- Curwen Inc. reported net cash flow from operating activities of $357,500 on its statement of cash flows for a recent year ended December 31. The following information was reported in the Cash flows from operating activities section of the statement of cash flows, using the indirect method: Decrease in income taxes payable $ 7,700Decrease in inventories 19,140Depreciation 29,480Gain on sale of investments 13,200Increase in accounts payable 5,280Increase in prepaid expenses 2,970Increase in accounts receivable 14,300a. Determine the net income reported by Curwen Inc. for the year ended December 31.b. Briefly explain why Curwen’s net income is different from net cash flow from operating activities.arrow_forwardCrane, Inc. reported net income of $2.65 million in 2022. Depreciation for the year was $169,600, accounts receivable decreased $371,000, and accounts payable decreased $296,800. Compute net cash provided by operating activities using the indirect method. (Show amounts that decrease cash flow with either a - sign e.g.-15,000 or in parenthesis e.g. (15,000).)arrow_forwardThe comparative balance sheets for Layton Company show these changes in noncash current asset accounts: Accounts receivable decrease: $83,700, Prepaid expenses increase: $27,180, and Inventories increase: $29,290. Compute net cash provided by operating activities using the indirect method assuming that net income is $180,980.arrow_forward
- Please do not give solution in image format thankuarrow_forwardSelected data derived from the income statement and balance sheet of National Beverage Co. for a recent year are as follows: Prepare the Cash Flows from Operating Activities section of the statement of cash flows, using the indirect method for National Beverage Co. Interpret your results in part (a).arrow_forwardCurwen Inc. reported net cash flows from operating activities of $357,500 on its statement of cash flows for a recent year ended December 31. The following information was reported in the Cash Flows from (used for) Operating Activities section of the statement of cash flows, using the indirect method: Decrease in income taxes payable $7,700 Decrease in inventories 19,140 Depreciation 29,480 Gain on sale of investments 13,200 Increase in accounts payable 5,280 Increase in prepaid expenses 2,970 Increase in accounts receivable 14,300 a. Determine the net income reported by Curwen Inc. for the year ended December 31.$fill in the blank 1 b. Curwen’s net income differed from net cash flows from operations because of the following: Depreciation expense, which has no effect on cash flows from operating activities. Gain on the sale of investments is reported in investing activities section of the cash flow statement. Changes in current operating assets and liabilities that…arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Managerial AccountingAccountingISBN:9781337912020Author:Carl Warren, Ph.d. Cma William B. TaylerPublisher:South-Western College Pub
Managerial Accounting
Accounting
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:South-Western College Pub