Piura Merchandising Corporation Income Statement At December 31, 20X1 Sales $ 1,500,000 Cost of goods sold $ 400,000 Beginning inventory Purchases 800,000 Ending inventory (200,000) (1,000,000) (100,000) (20,000) (80,000) (40,000) $ 260,000 (104,000) $ 156,000 Depreciation expense Amortization of patent Wages cxpcnse Insurance expense Income before taxces Income taxcs (all current) Net income
Piura Merchandising Corporation Income Statement At December 31, 20X1 Sales $ 1,500,000 Cost of goods sold $ 400,000 Beginning inventory Purchases 800,000 Ending inventory (200,000) (1,000,000) (100,000) (20,000) (80,000) (40,000) $ 260,000 (104,000) $ 156,000 Depreciation expense Amortization of patent Wages cxpcnse Insurance expense Income before taxces Income taxcs (all current) Net income
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
The income statement for Piura Merchandising Corporation is as follows:
Other information is as follows:
a. Accounts payable decreased by $20,000 during the year.
b.
c. All wages were paid at the beginning of the year; at the end of the year, wages payable had a balance of $12,000.
d. Prepaid insurance increased by $24,000 during year.
Required:
Prepare a schedule that provides the operating cash flows for the year using the indirect method.
Transcribed Image Text:Piura Merchandising Corporation
Income Statement
At December 31, 20X1
Sales
$ 1,500,000
Cost of goods sold
$ 400,000
Beginning inventory
Purchases
800,000
Ending inventory
(200,000)
(1,000,000)
(100,000)
(20,000)
(80,000)
(40,000)
$ 260,000
(104,000)
$ 156,000
Depreciation expense
Amortization of patent
Wages cxpcnse
Insurance expense
Income before taxces
Income taxcs (all current)
Net income
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