Statement of cash flows:
It is one of the financial statement that shows the cash, and cash equivalents of a company for a particular period. It determines the net changes in cash through reporting the sources and uses of cash due to the operating, investing, and financing activities of a company.
Cash flows from operating activities:
These refer to the cash received or cash paid in day-to-day operating activities of a company. In this direct method, cash flow from operating activities is computed by using all cash receipts, and cash payments during the year.
To explain: The apparent contradiction between the loss, and the positive cash flows.
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- The Net Profit of LSLS Corporation for the year is $ 2,515,250. Using the following information in the table and find out the Net Cash Flows from Operating Activities by Indirect Method SI. No : Particulars Amount ($) 1 Depreciation Expense 25,565.00 Decrease in Current Liabilities 57,677.00 3 Increase in Prepaid Insurance 67,076.00 4 Loss on Sale of Machinery 322,387.00 Gain on sale of Non Current Asset 377,553.00 6 Increase in Salaries Payable 64,704.00 7 Provision for Taxation 123,321.00 $ 2,584,921 O $ 2,548,921 O $ 2,544,921 O $ 2,458,921arrow_forward9.X Company made an operating profit of $185,500 after charging depreciation of $31,200. During that year, trade payables increased by $26,600 and inventory decreased by $40,300. There was no change to trade receivables. Assuming that no other factors affected it, the cash generated from operations would have been: O a) $203,000. O b) $230,400. c) $283,600. d) $149,800.arrow_forwardThe comparative balance sheets for Layton Company show these changes in noncash current asset accounts: Accounts receivable decrease: $83,700, Prepaid expenses increase: $27,180, and Inventories increase: $29,290. Compute net cash provided by operating activities using the indirect method assuming that net income is $180,980.arrow_forward
- Prepare a 2021 consolidated statement of cash flows for Plaster and Stucco. Use the indirect method of reporting cash flows from operating activities. (Negative amounts and amounts to be deducted should be Indicated by a minus sign.) PLASTER, INC., AND SUBSIDIARY STUCCO COMPANY Consolidated Statement of Cash Flows For the Year Ended December 31, 2021 Cash flows from operating activities: Consolidated net income Depreciation expense Amortization expense Decrease in accounts receivable Increase in inventory Decrease in accounts payable Net cash flow provided by operating activities Cash flows from investing activities: Purchase of Stucco Company assets Net cash flow used in investing activities Cash flows from financing activities: Issue long-term debt Dividends paid Net cash flow provided by financing activities Increase in cash 1/1/21 to 12/31/21 Beginning cash, 1/1/21 Ending cash, 12/31/21 199,200 9,380 5,500 (104,600) (8.900) (923,500) 924,540 (181,440) $ $ $ $ $ 292,220 100,580…arrow_forwardHi-Tech, Inc., reports net income of $70 million. Included in that number are depreciation expense of $6 million and a loss on the sale of equipment of $2 million. Records reveal increases in accounts receivable, accounts payable, and inventory of $3 million, $4 million, and $5 million, respectively. What are Hi-Tech’s net cash flows from operating activities?arrow_forwardAlpha Computers reports net income of $45 million. Included in that number is depreciation expense of $8 million, and a loss on the sale of land of $1 million. Records reveal decreases in Accounts Receivable, Inventory, and Accounts Payable of $5 million, $3 million, and $1 million, respectively. Calculate Alpha Computers' net cash flows from operating activities using the indirect method. (Negative value should be indicated by minus sign. Enter your answer in millions.) Net cash flows from operating activities millionarrow_forward
- Abiss company has erroneously skipped recording depreciation on one of its equipment amounting to $25,000, in its income statement. The company is planning for an increase in this depreciation. On the financial statements of Abiss this will Decrease net cash flow from operations on the cash flow statement. b. Not impact the cash flow statement c. Increase in net cash flow from operations on the cash flow statement d. No impact the Income statementarrow_forwardStaley Inc. reported the following data: Net income $211,000 Depreciation expense 58,400 Loss on disposal of equipment 26,900 Increase in accounts receivable 17,300 Increase in accounts payable 11,000 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, cash payments, decreases in cash, or any negative adjustments.arrow_forwardAbiss company has erroneously skipped recording depreciation on one of its equipment amounting to $25,000, in its income statement. The company is planning for an increase in this depreciation. On the financial statements of Abiss this wil . a. Decrease net cash flow from operations on the cash flow statement. b. Not impact the cash flow statement c. Increase in net cash flow from operations on the cash flow statement d. No impact the Income statementarrow_forward
- Staley Inc. reported the following data: Net income $338,400 Depreciation expense 66,700 Loss on disposal of equipment 31,900 Increase in accounts receivable 25,200 Increase in accounts payable 10,100 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, cash payments, decreases in cash, or any negative adjustments. what is the answer to this?arrow_forwardKennedy, Inc. reported the following data: Net income $140,711 Depreciation expense 16,055 Loss on disposal of equipment (10,768) Gain on sale of building 21,993 Increase in accounts receivable 7,626 Decrease in accounts payable (2,038) 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.arrow_forwardFeatherstone Inc. reported the following data: Net income $296,000 Depreciation expense 113,100 Gain on disposal of equipment 58,200 Decrease in accounts receivable 71,300 Decrease in accounts payable 27,100 Prepare the Cash Flows from (used for) Operating Activities section of the statement of cash flows, using the indirect method. Use the minus sign to indicate cash outflows, cash payments, decreases in cash, or any negative adjustments.arrow_forward
- Managerial AccountingAccountingISBN:9781337912020Author:Carl Warren, Ph.d. Cma William B. TaylerPublisher:South-Western College Pub