Question
In: Accounting
The net income reported on the income statement for the current year was $121,600. Depreciation recorded...
The net income reported on the income statement for the current year was $121,600. Depreciation recorded on store equipment for the year amounted to $20,100. Balances of the current asset and current liability accounts at the beginning and end of the year are as follows:
| End of Year | Beginning of Year | |||
| Cash | $49,490 | $45,530 | ||
| Accounts receivable (net) | 35,480 | 33,650 | ||
| Inventories | 48,450 | 51,220 | ||
| Prepaid expenses | 5,440 | 4,330 | ||
| Accounts payable (merchandise creditors) | 46,370 | 43,070 | ||
| Wages payable | 25,340 | 28,140 | ||
a. Prepare the Cash Flows from Operating Activities section of the statement of cash flows, using the indirect method. Use the minus sign to indicate cash out flows, cash payments, decreases in cash, or any negative adjustments.
| Statement of Cash Flows (partial) | ||
| Cash flows from operating activities: | ||
| $ | ||
| Adjustments to reconcile net income to net cash flow from operating activities: | ||
| Changes in current operating assets and liabilities: | ||
| Net cash flow from operating activities | $ | |
b. Cash flows from operating activities differs from net income because it does not use the (Actual basis/cash basis)of accounting. For example, revenues are recorded on the income statement when (They are earned/cash is received)
Solutions
Expert Solution
a. Prepare the Cash Flows from Operating Activities section of the statement of cash flows, using the indirect method. Use the minus sign to indicate cash out flows, cash payments, decreases in cash, or any negative adjustments.
| Statement of Cash Flows (partial) | ||
| Cash flows from operating activities: | ||
| Net income | $121600 | |
| Adjustments to reconcile net income to net cash flow from operating activities: | ||
| Depreciation expense | 20100 | |
| Changes in current operating assets and liabilities: | ||
| Increase account receivable | -1830 | |
| Decrease inventories | 2770 | |
| Increase prepaid expense | -1110 | |
| Increase account payable | 3300 | |
| Decrease wages payable | -2800 | |
| Net cash flow from operating activities | $142030 | |
b. Cash flows from operating activities differs from net income because it does not use the Accrual basis of accounting. For example, revenues are recorded on the income statement when They are earned.
ekkarill92 answered 2 years agoRelated Solutions
The net income reported on the income statement for the current year was $121,900. Depreciation recorded...
The net income reported on the income statement for the current
year was $121,900. Depreciation recorded on store equipment for the
year amounted to $20,100. Balances of the current asset and current
liability accounts at the beginning and end of the year are as
follows:
End of Year
Beginning of Year
Cash
$47,050
$42,820
Accounts receivable (net)
33,730
31,640
Inventories
46,060
48,170
Prepaid expenses
5,180
4,070
Accounts payable (merchandise creditors)
44,090
40,510
Wages payable
24,090
26,460
a. Prepare the “Cash...
The net income reported on the income statement for the current year was $361,300. Depreciation recorded...
The net income reported on the income statement for the current
year was $361,300. Depreciation recorded on store equipment for the
year amounted to $15,520. Balances of the current asset and current
liability accounts at the beginning and end of the year are as
follows:
End of Year
Beginning of Year
Cash
$40,180
$40,070
Accounts receivable (net)
30,070
28,060
Merchandise inventory
40,390
45,420
Prepaid expenses
3,470
4,840
Accounts payable (merchandise creditors)
38,610
37,710
Wages payable
20,330
24,800
Required:
A.
Prepare...
The net income reported on the income statement for the current year was $313,900. Depreciation recorded...
The net income reported on the income statement for the current
year was $313,900. Depreciation recorded on equipment and a
building amounted to $93,900 for the year. Balances of the current
asset and current liability accounts at the beginning and end of
the year are as follows: End of Year Beginning of Year Cash $80,360
$84,380 Accounts receivable (net) 101,900 104,120 Inventories
200,900 179,390 Prepaid expenses 11,170 11,900 Accounts payable
(merchandise creditors) 89,760 94,170 Salaries payable 12,940
11,730 a. Prepare...
The net income reported on the income statement for the current year was $318,700. Depreciation recorded...
The net income reported on the income statement for the current
year was $318,700. Depreciation recorded on equipment and a
building amounted to $93,980 for the year. Balances of the current
asset and current liability accounts at the beginning and end of
the year are as follows:
End of Year
Beginning of Year
Cash
$90,370
$95,280
Accounts receivable (net)
111,660
118,570
Inventories
232,780
203,250
Prepaid expenses
12,000
15,310
Accounts payable (merchandise creditors)
96,420
104,940
Salaries payable
15,310
13,420
Required:
A....
The net income reported on the income statement for the current year was $153,400. Depreciation recorded...
The net income reported on the income statement for the current
year was $153,400. Depreciation recorded on store equipment for the
year amounted to $25,300. Balances of the current asset and current
liability accounts at the beginning and end of the year are as
follows:
End of Year
Beginning of Year
Cash
$61,820
$56,260
Accounts receivable (net)
44,320
41,580
Inventories
60,520
63,290
Prepaid expenses
6,800
5,340
Accounts payable (merchandise creditors)
57,930
53,220
Wages payable
31,650
34,770
a. Prepare the “Cash...
The net income reported on the income statement for the current year was $330,400. Depreciation recorded...
The net income reported on the income statement for the current
year was $330,400. Depreciation recorded on equipment and a
building amounted to $105,140 for the year. Balances of the current
asset and current liability accounts at the beginning and end of
the year are as follows:
End of Year
Beginning of Year
Cash
$89,900
$95,010
Accounts receivable (net)
111,940
117,700
Inventories
217,550
209,050
Prepaid expenses
13,290
14,160
Accounts payable (merchandise creditors)
95,060
103,580
Salaries payable
15,590
13,710
Required:
A....
The net income reported on the income statement for the current year was $210,000. Depreciation recorded on...
The net income reported on the income statement for the current
year was $210,000. Depreciation recorded on equipment
and a building amount to $62,500 for the year. Balances
of the current asset and current liabilities accounts at the
beginning and end of the year are as follows:
End of Year
Beginning of Year
Cash
$ 56,000
$ 59,500
Accounts receivable (net)
71,000
73,400
Inventories
140,000
126,500
Prepaid expenses
7,800
8,400
Accounts payable (merchandise creditors)
62,600
66,400
Salaries payable
9,000
8,250
...
The net income reported on the income statement for the current year was $257,354. Depreciation recorded...
The net income reported on the income statement for the current
year was $257,354. Depreciation recorded on fixed assets and
amortization of patents for the year were $38,458 and $8,183,
respectively. Balances of current asset and current liability
accounts at the end and at the beginning of the year are as
follows:
End
Beginning
Cash
$38,512
$58,825
Accounts receivable
121,075
106,825
Inventories
110,540
96,483
Prepaid expenses
3,229
7,216
Accounts payable (merchandise creditors)
45,517
60,398
What is the amount of cash...
The net income reported on the income statement for the current year was $318,700. Depreciation recorded...
The net income reported on the income statement for the current
year was $318,700. Depreciation recorded on equipment and a
building amounted to $93,980 for the year. Balances of the current
asset and current liability accounts at the beginning and end of
the year are as follows:
End
of Year
Beginning of Year
Cash
$90,370
$95,280
Accounts receivable (net)
111,660
118,570
Inventories
232,780
203,250
Prepaid expenses
12,000
15,310
Accounts payable (merchandise
creditors)
96,420
104,940
Salaries payable
15,310
13,420
Required:
A....
The net income reported on the income statement for the current year was $258,880. Depreciation recorded...
The net income reported on the income statement for the current
year was $258,880. Depreciation recorded on fixed assets and
amortization of patents for the year were $37,299 and $9,059,
respectively. Balances of current asset and current liability
accounts at the end and at the beginning of the year are as
follows:
End
Beginning
Cash
$53,792
$43,725
Accounts Receivable
120,269
104,586
Inventories
102,005
90,872
Prepaid Expenses
2,087
7,274
Accounts Payable (merchandise creditors)
53,041
72,688
What is the amount of cash...
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