Kennedy, Inc. reported the following data: Net income Depreciation expense Loss on disposal of equipment Gain on sale of building Increase in accounts receivable Decrease in accounts payable $152,168 12,599 (10,151) 19,285 8,486 (3,847) 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 outflows, a decrease in cash, cash payments, or any negative adjustments.

Kennedy, Inc. reported the following data: Net income Depreciation expense Loss on disposal of equipment Gain on sale of building Increase in accounts receivable Decrease in accounts payable $152,168 12,599 (10,151) 19,285 8,486 (3,847) 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 outflows, a decrease in cash, cash payments, or any negative adjustments.

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter14: Statement Of Cash Flows

Section: Chapter Questions

Problem 48P

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Which item is added to net income when computing cash flows from operating activities? a. Gain on the disposal of property, plant, and equipment b. Increase in wages payable c. Increase in inventory d. Increase in prepaid rent Use the following information for Multiple-Choice Questions 11-9 and 11-10: Cornett Company reported the following information: cash received from the issuance of common stock, $150,000; cash received from the sale of equipment, $14,800; cash paid to purchase an investment, $20,000; cash paid to retire a note payable, $50,000; and cash collected from sales to customers, $225,000.
Roberts Company provided the following partial comparative balance sheets and the income statement for 20X2. Required: Compute operating cash flows using the indirect method.
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The gain on sale of equipment is deducted from net income to arrive at operating cash flows because a. the sale of long-term assets is an operating activity. b. the gain reveals the total cash received. c. all of the cash received from the sale is reported in the operating section. d. All of these. e. None of these.
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