Answered: Presented below is the income statement…

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 54P

See similar textbooks

Related questions

Question

Presented below is the income statement of Sandra, Inc.:

Sales revenue		$384,000
Cost of goods sold		226,500
Gross profit		$157,500
Operating expenses		96,600
Income before income taxes		60,900
Income taxes		23,800
Net income		$ 37,100

In addition, the following information related to net changes in working capital is presented:

	Debit	Credit
Cash	$13,000
Accounts receivable	26,000
Inventories		$19,400
Salaries payable (operating expenses)	8,200
Accounts payable		13,800
Income taxes payable	2,900

The company also indicates that depreciation expense for the year was $16,700 and that the deferred tax liability account increased $3,000.

A. Prepare a schedule computing the net cash flow from operating activities by using the indirect method that would be shown on a statement of cash flows. (Show amounts that decrease cash flow with either a - sign e.g. -10,000 or in parenthesis e.g. (10,000).)

B.Prepare a schedule computing the net cash flow from operating activities by using the direct method that would be shown on a statement of cash flows.

Expert Solution

Trending now

This is a popular solution!

Step by step

Solved in 2 steps with 2 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions