e net income reported on the income statement for the current year was $222,200. Depreciation recorded on equipment and a building amounted to s66,400 for the year. Balances the current asset and current liability accounts at the beginning and end of the pre as follows: End Beginning of Year of Year Cash $61,330 $64,400 Accounts receivable (net) 77,770 79,470 Inventories 153,330 136,910 Prepaid expenses 8,520 9,080 Accounts payable (merchandise creditors) 68,510 71,870 Salaries payable 9,870 8,950 a. Prepare the Cash Flows from (used for) Operating Activities section of the statement of cash flows, using the indirect method. Use the minus sign to indicate cash outflows, cash payments, decreases in cash, or any negative adjustments. Statement of Cash Flows (partial) Cash flows from (used for) operating activities: Adjustments to reconcile net income to net cash flows from (used for) operating activities: Changes in current operating assets and liabilities: Net cash flows from operal activities b. If the direct method had been used, would the net cash flow from operating activities have been the same?
e net income reported on the income statement for the current year was $222,200. Depreciation recorded on equipment and a building amounted to s66,400 for the year. Balances the current asset and current liability accounts at the beginning and end of the pre as follows: End Beginning of Year of Year Cash $61,330 $64,400 Accounts receivable (net) 77,770 79,470 Inventories 153,330 136,910 Prepaid expenses 8,520 9,080 Accounts payable (merchandise creditors) 68,510 71,870 Salaries payable 9,870 8,950 a. Prepare the Cash Flows from (used for) Operating Activities section of the statement of cash flows, using the indirect method. Use the minus sign to indicate cash outflows, cash payments, decreases in cash, or any negative adjustments. Statement of Cash Flows (partial) Cash flows from (used for) operating activities: Adjustments to reconcile net income to net cash flows from (used for) operating activities: Changes in current operating assets and liabilities: Net cash flows from operal activities b. If the direct method had been used, would the net cash flow from operating activities have been the same?
Chapter12: Current Liabilities
Section: Chapter Questions
Problem 1PB: Consider the following situations and determine (1) which type of liability should be recognized...
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Transcribed Image Text:The net income reported on the income statement for the current year was $222,200. Depreciation recorded on equipment and a building amounted to $66,400 for the year. Balances of the current asset and current liability accounts at the beginning and end of the year
are as follows:
End
Beginning
of Year
of Year
Cash
$61,330
$64,400
Accounts receivable (net)
77,770
79,470
Inventories
153,330
136,910
Prepaid expenses
8,520
9,080
Accounts payable (merchandise creditors)
68,510
71,870
Salaries payable
9,870
8,950
a. Prepare the Cash Flows from (used for) Operating Activities section of the statement of cash flows, using the indirect method. Use the minus sign to indicate cash outflows, cash payments, decreases in cash, or any negative adjustments.
Statement of Cash Flows (partial)
Cash flows from (used for) operating activities:
Adjustments to reconcile net income to net cash flows from (used for) operating activities:
Changes in current operating assets and liabilities:
Net cash flows from operating activities
b. If the direct method had been used, would the net cash flow from operating activities have been the same?
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