Using the Exhibit below, assume that the balance of Accounts Receivable was $61,000 at the beginning of the current year. Furthermore, assume that the balance of Accounts Receivable is $62,000 at the end of the current year. When preparing the Statement of Cash Flow using the indirect method for the current year, which of the following statements would describe the proper presentation of accounts receivable on the Cash flow from operating activities section? EXHIBIT Increase (Decrease) Net Income (loss) $XXX Adjustments to reconcile net income to net cash flow from operating activities: Depreciation of fixed assets XXX Losses on disposal of assets XXX Gains on disposal of assets (XXX) Changes in current operating assets and liabilities: Increases in *noncash current operating assets (XXX) Decreases in **noncash current operating assets XXX Increases in **current operating liabilities XXX Decreases in *current operating liabilities (XXX) *SUBTRACT **ADD Increases in accounts receivable Decreases in accounts receivable Increases in inventory Decreases in inventory Increases in prepaid expenses Decreases in prepaid expenses Decreases in accounts payable Increases in accounts payable Decreases in accrued expenses payable Increases in accrued expenses payable Group of answer choices Deduct a decrease in Accounts Receivable of $61,000 in the Changes in current operating assets and liabilities section. Add a decrease in Accounts Receivable of $62,000 in the Changes in current operating assets and liabilities section. Deduct an increase in Accounts Receivable of $1,000 in the Changes in current operating assets and liabilities section. Add an increase in Accounts Receivable of $1,000 in the Changes in current operating assets and liabilities section.
Using the Exhibit below, assume that the balance of
EXHIBIT
Increase
(Decrease)
Net Income (loss) $XXX
Adjustments to reconcile net income to net cash flow
from operating activities:
Losses on disposal of assets XXX
Gains on disposal of assets (XXX)
Changes in current operating assets and liabilities:
Increases in *noncash current operating assets (XXX)
Decreases in **noncash current operating assets XXX
Increases in **current operating liabilities XXX
Decreases in *current operating liabilities (XXX)
*SUBTRACT **ADD
Increases in accounts receivable Decreases in accounts receivable
Increases in inventory Decreases in inventory
Increases in prepaid expenses Decreases in prepaid expenses
Decreases in accounts payable Increases in accounts payable
Decreases in accrued expenses payable Increases in accrued expenses payable
Trending now
This is a popular solution!
Step by step
Solved in 2 steps with 1 images
