![INTERMEDIATE ACCOUNTING(LL)-W/CONNECT](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9781260216141/9781260216141_smallCoverImage.gif)
INTERMEDIATE ACCOUNTING(LL)-W/CONNECT
9th Edition
ISBN: 9781260216141
Author: SPICELAND
Publisher: MCG CUSTOM
expand_more
expand_more
format_list_bulleted
Concept explainers
Textbook Question
Chapter 21, Problem 21.26E
Cash flow s from operating activities (indirect method)—includes sale of cash equivalent
• LO21–4
Refer to the data provided in E 21–25 for Clear Transmissions Company.
Required:
Prepare the
E 21–25
Cash flows from operating activities (direct method)—includes sale of cash equivalent
• LO21–3
Portions of the financial statements for Clear Transmissions Company are provided on the following page.
Required:
Prepare the cash flows from operating activities section of the statement of cash flows for Clear Transmissions Company using the direct method.
Expert Solution & Answer
![Check Mark](/static/check-mark.png)
Want to see the full answer?
Check out a sample textbook solution![Blurred answer](/static/blurred-answer.jpg)
Students have asked these similar questions
v Qu B
IUS
Paragraph
Arial
14px
A v
QUESTION 13
The indirect method for the preparation of the operating activities section of the statement of cash flows:
A. Separately lists each major item of operating cash receipts.
B. Must not be used in all circumstances.
O C. Separately lists each major item of operating cash payments.
O D. Reports net income and then adjusts it for items necessary to determine net cash provided or used by operating activities.
QUESTION 14
Which section of the statement of cash flows is used to report the purchase of a building by issuing a 9-month note payable?
OA. Operating activities.
O B. Financing activities.
C. Investing activities.
Click Save and Submit to save and submit. Click Save All Answers to save all answers.
II
!!!
>
ok
t
Exercise 12-6A (Algo) Direct versus indirect method of determining cash flows from operating activities
LO 12-1, 12-2
Expert Electronics, Incorporated (EEI) recognized $8,000 of sales revenue on account and collected $4,900 of cash from accounts
receivable. Further, EEl recognized $3,700 of operating expenses on account and paid $2,100 cash as partial settlement of accounts
payable.
Required
Based on this information alone:
a. Prepare the operating activities section of the statement of cash flows under the direct method.
Note: Amounts to be deducted should be indicated with a minus sign.
Operating Activities - Direct Method
Cash flows from operating activities:
Net cash flow from operating activities
b. Prepare the operating activities section of the statement of cash flows under the indirect method.
Note: Amounts to be deducted should be indicated with a minus sign.
Problem 11-8A (Algo) Prepare an income statement using operating cash flow information-indirect and
direct methods (LO11-3, 11-7)
Cash flows from operating activities for both the indirect and direct methods are presented for Reverse Logic. All
amounts are in thousands (000s).
Cash Flows from Operating Activities (Indirect method)
Net income
Adjustments to reconcile net income to net cash flows from operating
activities:
Depreciation expense
Increase in accounts receivable
Decrease in inventory
Increase in prepaid rent
Decrease in accounts payable
Decrease in income tax payable
Net cash flows from operating activities
Cash Flows from Operating Activities (Direct method)
Cash received from customers
Cash paid to suppliers
Cash paid for operating expenses
Cash paid for income taxes
Net cash flows from operating activities
REVERSE LOGIC
Income Statement
For the Year Ended December 31, 2024
Net sales
Expenses:
Cost of goods sold
Operating expenses
Depreciation
expense
Income tax expense…
Chapter 21 Solutions
INTERMEDIATE ACCOUNTING(LL)-W/CONNECT
Ch. 21 - Effects of all cash flows affect the balances of...Ch. 21 - Prob. 21.2QCh. 21 - Prob. 21.3QCh. 21 - Prob. 21.4QCh. 21 - Prob. 21.5QCh. 21 - Prob. 21.6QCh. 21 - Prob. 21.7QCh. 21 - The sale of stock and the sale of bonds are...Ch. 21 - Does the statement of cash flows report only...Ch. 21 - Prob. 21.10Q
Ch. 21 - Perhaps the most noteworthy item reported on an...Ch. 21 - Prob. 21.12QCh. 21 - Given sales revenue of 200,000, how can it be...Ch. 21 - Prob. 21.14QCh. 21 - When determining the amount of cash paid for...Ch. 21 - Prob. 21.16QCh. 21 - When using the indirect method of determining net...Ch. 21 - Prob. 21.18QCh. 21 - Prob. 21.19QCh. 21 - Where can we find authoritative guidance for the...Ch. 21 - U.S. GAAP designates cash outflows for interest...Ch. 21 - Prob. 21.1BECh. 21 - Prob. 21.2BECh. 21 - Prob. 21.3BECh. 21 - Prob. 21.4BECh. 21 - Prob. 21.5BECh. 21 - Prob. 21.6BECh. 21 - Prob. 21.7BECh. 21 - Prob. 21.8BECh. 21 - Investing activities LO215 Carter Containers sold...Ch. 21 - Financing activities LO216 Refer to the situation...Ch. 21 - Prob. 21.11BECh. 21 - Prob. 21.12BECh. 21 - Classification of cash flows LO213 through LO216...Ch. 21 - Determine cash paid to suppliers of merchandise ...Ch. 21 - Determine cash received from customers LO213...Ch. 21 - Prob. 21.4ECh. 21 - Prob. 21.5ECh. 21 - Prob. 21.6ECh. 21 - Determine cash paid for bond interest LO213...Ch. 21 - Determine cash paid for bond interest LO213 For...Ch. 21 - Determine cash paid for income taxes LO213...Ch. 21 - Prob. 21.10ECh. 21 - Prob. 21.11ECh. 21 - Installment note; statement of cash flow effects ...Ch. 21 - Prob. 21.13ECh. 21 - Identifying cash flows from investing activities...Ch. 21 - Prob. 21.15ECh. 21 - Prob. 21.16ECh. 21 - Indirect method; reconciliation of net income to...Ch. 21 - Spreadsheet entries from statement of retained...Ch. 21 - Prob. 21.19ECh. 21 - Prob. 21.20ECh. 21 - Cash flow s from operating activities (direct...Ch. 21 - Indirect method; reconciliation of net income to...Ch. 21 - Prob. 21.23ECh. 21 - Cash flows from operating activities (indirect...Ch. 21 - Prob. 21.25ECh. 21 - Cash flow s from operating activities (indirect...Ch. 21 - Prob. 21.27ECh. 21 - Prob. 21.28ECh. 21 - Prob. 21.29ECh. 21 - Prob. 21.30ECh. 21 - Prob. 21.31ECh. 21 - Prob. 21.32ECh. 21 - Prob. 21.1PCh. 21 - Statement of cash flows; direct method LO213,...Ch. 21 - Prob. 21.3PCh. 21 - Statement of cash flows; direct method LO213,...Ch. 21 - Statement of cash flows; direct method LO213,...Ch. 21 - Cash flows from operating activities (direct...Ch. 21 - Prob. 21.7PCh. 21 - Cash flows from operating activities (direct...Ch. 21 - Cash flows from operating activities (direct...Ch. 21 - Prob. 21.10PCh. 21 - Prepare a statement of cash flows; direct method ...Ch. 21 - Prob. 21.12PCh. 21 - Prob. 21.13PCh. 21 - Statement of cash flows; indirect method; limited...Ch. 21 - Integrating problem; bonds; lease transactions;...Ch. 21 - Statement of cash flows; indirect method LO214,...Ch. 21 - Prob. 21.17PCh. 21 - Statement of cash flows; indirect method LO214,...Ch. 21 - Prob. 21.19PCh. 21 - Prob. 21.20PCh. 21 - Prob. 21.21PCh. 21 - Prob. 21.1BYPCh. 21 - Prob. 21.2BYPCh. 21 - Research Case 213 Information from cash flow...Ch. 21 - Analysis Case 215 Smudged ink; find missing...Ch. 21 - Real World Case 216 Analyze cash flow activities;...Ch. 21 - Prob. 21.7BYPCh. 21 - Prob. 21.8BYPCh. 21 - Research Case 219 FASB codification; locate and...Ch. 21 - IFRS Case 2110 Statement of cash flows...Ch. 21 - Prob. CCTC
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
- (Appendix 21.1) Operating Cash Flows Refer to the information for Lamberson Company in P21-6. Required: 1. Using the direct method, prepare the operating activities section of the 2019 statement of cash flows for Lamberson. 2. (Optional). If you completed P21-6 earlier, prepare the remaining portion of the statement of cash flows. (A separate schedule reconciling net income to cash provided by operating activities is not necessary.)arrow_forwardPreparing Net Cash Flows from Operating Activities-Direct Method Colassard Industries has the following data available for preparation of its statement of cash flows: Required: Prepare the cash flows from operating activities section of the statement of cash flows using the direct method.arrow_forwardProblem 21-16 (Algo) Statement of cash flows; indirect method [LO21-4, 21-8] The comparative balance sheets for 2021 and 2020 and the statement of income for 2021 are given below for Dux Company. Additional information from Dux’s accounting records is provided also. DUX COMPANYComparative Balance SheetsDecember 31, 2021 and 2020($ in thousands) 2021 2020 Assets Cash $ 117.0 $ 34.0 Accounts receivable 62.0 64.0 Less: Allowance for uncollectible accounts (3.0 ) (2.0 ) Dividends receivable 17.0 16.0 Inventory 69.0 64.0 Long-term investment 29.0 24.0 Land 84.0 40.0 Buildings and equipment 169.0 264.0 Less: Accumulated depreciation (7.0 ) (120.0 ) $ 537.0 $ 384.0 Liabilities Accounts payable $ 27.0 $ 34.0 Salaries payable 16.0 19.0 Interest payable 18.0 16.0 Income tax payable…arrow_forward
- IAS 7 Statement of cash flows allows entities to present cash flow from operating activities, using either indirect method or direct method. a. Explain why and how the following are adjusted when preparing the statement of cash flows following the indirect method • Depreciation/amortisation • Profit/loss on disposal • Interest receivable/investment income • Finance costs • Change in receivable • Change in inventory • Change in payables. b. The statement of cash flows is an important part of the financial statements. Outline the importance of statement of cash flowsarrow_forwardProblem 21-4 (Algo) Statement of cash flows; direct method [LO21-3, 21-8] The comparative balance sheets for 2021 and 2020 and the statement of income for 2021 are given below for Dux Company. Additional information from Dux's accounting records is provided also. DUX COMPANYComparative Balance SheetsDecember 31, 2021 and 2020($ in thousands) 2021 2020 Assets Cash $ 49 $ 24 Accounts receivable 46 53 Less: Allowance for uncollectible accounts (3 ) (2 ) Dividends receivable 3 2 Inventory 65 60 Long-term investment 21 18 Land 85 60 Buildings and equipment 273 290 Less: Accumulated depreciation (70 ) (90 ) $ 469 $ 415 Liabilities Accounts payable $ 35 $ 43 Salaries payable 3 7 Interest payable 7 2 Income tax payable 8 9 Notes payable 25 0 Bonds payable…arrow_forwardPrepare a statement of cash flow for bramble inc using the direct method unit iV question 18arrow_forward
- #203 How should significant noncash transactions be reported in the statement of cash flows according to FASB Statement No. 95? Question 203 options: a These noncash transactions are not to be incorporated in the statement of cash flows. They may be summarized in a separate schedule at the bottom of the statement or appear in a separate supplementary schedule to the financials. b They should be handled in a manner consistent with the transactions that affect cash flows. c They should be incorporated in the statement of cash flows in a section labeled, "Significant Noncash Transactions." d Such transactions should be incorporated in the section (operating, financing, or investing) that is most representative of the major component of the transaction.arrow_forwardQUESTION 30 Statement of Cash flows requires that cash receipts and payments should be analysed into three main categories. Under which category would you expect to find the cash proceeds from a share issue? a. Financing activities •b. Operating activities c. Investing activities d.Cash and cash equivalentsarrow_forwardRead CA23-5 found in the end of chapter materials of Chapter 23 and answer the related questions. CA23-5. (Purpose and Elements of SCF) GAAP requires the statement of cash flows be presented when financial statements are prepared. Instructions (a) Explain the purposes of the statement of cash flows. (b) List and describe the three categories of activities that must be reported in the statement of cash flows. (c) Identify and describe the two methods that are allowed for reporting cash flows from operations. (d) Describe the financial statement presentation of noncash investing and financing transactions. Include in your description an example of a noncash investing and financing transaction.arrow_forward
- In an statement of cash flows what is included in the operating activities section? In the investment section? In the financial activities section? One or two paragraph minimum per section CH 15arrow_forwardP12-5 LO12-2, 12-4, 12-6 Chapter Supplement B) Preparing a Statement of Cash Flows with Gain on Sale of Equipment (Indirect Method) (AP12-5) XS Supply Company is developing its annual financial statements at December 31, current year. The statements are complete except for the statement of cash flows. The completed comparative balance sheets and income statement are summarized below: Balance sheet at December 31 Cash Accounts receivable Merchandise inventory Property and equipment Less: Accumulated depreciation Accounts payable Wages payable Note payable, long-term Common stock and additional paid-in capital Retained earnings Income statement for current year Sales Gain on sale of equipment Cost of goods sold Other expenses Net income Additional Data: Current Year 2. Evaluate the statement of cash flows. $ 34,000 35,000 41,000 121,000 (30,000) $201,000 $ 36,000 1,200 38,000 88,600 37,200 $201,000 $120,000 1,000 (70,000) (38,800) $ 12,200 Prior Year $ 29,000 28,000 38,000 100,000…arrow_forwardProblem 21-17 (Algo) Statement of cash flows; indirect method [LO21-4, 21-8] Comparative balance sheets for 2021 and 2020 and a statement of income for 2021 are given below for Metagrobolize Industries. Additional information from the accounting records of Metagrobolize also is provided. METAGROBOLIZE INDUSTRIESComparative Balance SheetsDecember 31, 2021 and 2020($ in thousands) 2021 2020 Assets Cash $ 405 $ 245 Accounts receivable 350 190 Inventory 500 275 Land 500 450 Building 900 900 Less: Accumulated depreciation (200 ) (180 ) Equipment 2,500 2,150 Less: Accumulated depreciation (325 ) (300 ) Patent 1,000 1,150 $ 5,630 $ 4,880 Liabilities Accounts payable $ 600 $ 400 Accrued liabilities 150 130 Lease liability—land 130 0 Shareholders' Equity Common stock…arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- Cornerstones of Financial AccountingAccountingISBN:9781337690881Author:Jay Rich, Jeff JonesPublisher:Cengage LearningIntermediate Accounting: Reporting And AnalysisAccountingISBN:9781337788281Author:James M. Wahlen, Jefferson P. Jones, Donald PagachPublisher:Cengage LearningFinancial Accounting: The Impact on Decision Make...AccountingISBN:9781305654174Author:Gary A. Porter, Curtis L. NortonPublisher:Cengage Learning
![Text book image](https://www.bartleby.com/isbn_cover_images/9781337690881/9781337690881_smallCoverImage.gif)
Cornerstones of Financial Accounting
Accounting
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Cengage Learning
![Text book image](https://www.bartleby.com/isbn_cover_images/9781337788281/9781337788281_smallCoverImage.jpg)
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:Cengage Learning
![Text book image](https://www.bartleby.com/isbn_cover_images/9781305654174/9781305654174_smallCoverImage.gif)
Financial Accounting: The Impact on Decision Make...
Accounting
ISBN:9781305654174
Author:Gary A. Porter, Curtis L. Norton
Publisher:Cengage Learning
The KEY to Understanding Financial Statements; Author: Accounting Stuff;https://www.youtube.com/watch?v=_F6a0ddbjtI;License: Standard Youtube License