BuyFindarrow_forward

Cornerstones of Financial Accounti...

4th Edition
Jay Rich + 1 other
ISBN: 9781337690881

Solutions

Chapter
Section
BuyFindarrow_forward

Cornerstones of Financial Accounti...

4th Edition
Jay Rich + 1 other
ISBN: 9781337690881
Textbook Problem
1 views

Reporting Net Cash Flow from Operating Activities

The income statement for Dunn Products Inc. is presented below.

Chapter 11, Problem 53PSB, Reporting Net Cash Flow from Operating Activities The income statement for Dunn Products Inc. is

The following balance sheet changes occurred during the year:

• Accounts receivable decreased by $85,150.

• Inventory decreased by $138,620.

• Prepaid expenses increased by $112,400.

• Accounts payable decreased by $67,225.

• Salaries payable increased by $18,300.

Required:

1. Prepare the net cash flows from operating activities using the indirect method.

2. CONCEPTUAL CONNECTION What are the causes of the major differences between net income and net cash flow from operating activities?

To determine

(a)

In budgetary bookkeeping, a cash flow statement, otherwise called statement of cash flows, is a fiscal report that demonstrates how changes in monetary record records and pay influence cash and cash reciprocals, and separates the examination to operating, investing, and financing activities.

To compute:

Prepare the net cash flows from operating activities using the indirect method.

Explanation

Format of operating activity

Particular Detail ($) Amount ($)
Net income as per income statement 45300
Depreciation expense 214500
Bad debt 37000 251500
Operating profit before working capital change
To determine

(b)

In budgetary bookkeeping, a cash flow statement, otherwise called statement of cash flows, is a fiscal report that demonstrates how changes in monetary record records and pay influence cash and cash reciprocals, and separates the examination to operating, investing, and financing activities.

To discuss:

What are the causes of the major differences between net income and net cash flow from operating activities?

Still sussing out bartleby?

Check out a sample textbook solution.

See a sample solution

The Solution to Your Study Problems

Bartleby provides explanations to thousands of textbook problems written by our experts, many with advanced degrees!

Get Started

Chapter 11 Solutions

Show all chapter solutions add

Additional Business Solutions

Find more solutions based on key concepts

Show solutions add

In what ways is economics a science?

Principles of Economics (MindTap Course List)

Discuss the importance of data models.

Database Systems: Design, Implementation, & Management

Should Gladys call the legal authorities? Which agency should she call?

Principles of Information Security (MindTap Course List)

Define supply chain management (SCM).

Fundamentals of Information Systems

Describe the process by which engineers evaluate alternatives.

Engineering Fundamentals: An Introduction to Engineering (MindTap Course List)

What are the three common levels of planning?

Management Of Information Security

Case Study Amateur Sports League You are the new manager for a nonprofit amateur soccer league. Several employe...

Enhanced Discovering Computers 2017 (Shelly Cashman Series) (MindTap Course List)