a. 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.
a. 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.
Financial Accounting: The Impact on Decision Makers
10th Edition
ISBN:9781305654174
Author:Gary A. Porter, Curtis L. Norton
Publisher:Gary A. Porter, Curtis L. Norton
Chapter7: Receivables And Investments
Section: Chapter Questions
Problem 7.19MCE
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![a. 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.
Cash flows from (used for) operating activities:
Net income
Adjustments to reconcile net income to net cash flows from (used for) operating activities:
Depreciation expense
Statement of Cash Flows (partial)
Gain on disposal of equipment
✓
Changes in current operating assets and liabilities:
Increase in accounts receivable
Decrease in inventory
Decrease in prepaid insurance
Decrease in accounts payable
Increase in income taxes payable
Net cash flows from operating activities
Feedback
542,000
57,000
-24,000
-9,800
5,550
1,000
-3,700
1,440
X](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fd50c0385-18a3-4d4e-8e5f-5b999135f66a%2F14e43b65-b4d9-48b8-9258-4acd3c7b1ecb%2Ficrz85q_processed.jpeg&w=3840&q=75)
Transcribed Image Text:a. 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.
Cash flows from (used for) operating activities:
Net income
Adjustments to reconcile net income to net cash flows from (used for) operating activities:
Depreciation expense
Statement of Cash Flows (partial)
Gain on disposal of equipment
✓
Changes in current operating assets and liabilities:
Increase in accounts receivable
Decrease in inventory
Decrease in prepaid insurance
Decrease in accounts payable
Increase in income taxes payable
Net cash flows from operating activities
Feedback
542,000
57,000
-24,000
-9,800
5,550
1,000
-3,700
1,440
X
![Cash Flows from (Used for) Operating Activities
The income statement disclosed the following items for the year:
Depreciation expense
Gain on disposal of equipment
Net income
The changes in the current asset and liability accounts for the year are as follows:
Accounts receivable
Inventory
Prepaid insurance
Accounts payable
Income taxes payable
Dividends payable
$57,000
24,000
542,000
Increase
(Decrease)
$9,800
(5,550)
(1,000)
(3,700)
1,440
2,200
a. 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.
Statement of Cash Flows (partial)
Cash flows from (used for) onerating activities:
47](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fd50c0385-18a3-4d4e-8e5f-5b999135f66a%2F14e43b65-b4d9-48b8-9258-4acd3c7b1ecb%2Fueddu74_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Cash Flows from (Used for) Operating Activities
The income statement disclosed the following items for the year:
Depreciation expense
Gain on disposal of equipment
Net income
The changes in the current asset and liability accounts for the year are as follows:
Accounts receivable
Inventory
Prepaid insurance
Accounts payable
Income taxes payable
Dividends payable
$57,000
24,000
542,000
Increase
(Decrease)
$9,800
(5,550)
(1,000)
(3,700)
1,440
2,200
a. 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.
Statement of Cash Flows (partial)
Cash flows from (used for) onerating activities:
47
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