Operating activities—indirect method (Learning Objective 3) 10–15 min.

The March accounting records of Penestrie, Inc., include these accounts:

Cash Mar 1 Receipts 8,000 448,000 Payments 451,000 Accounts Receivable Mar 1 Sales 18,000 454,000 Collections 460,000 Mar 31 5,000 Inventory Mar 1 Purchases 19,000 278,000 Cost of goods sold 264,000 Mar 31 12,000 0

Accounts Payable Payments 283,000 Mar 1 Purchases 7,000 294,000 Mar 31 33,000 Accumulated Depreciation Mar 1 Depreciation expense Mar 31 63,000 9,000 72,000 Mar 31 18,000 0

0 0

Retained Earnings Dividends 25,000 Mar 1 Net income Mar 31 84,000 73,000 132,000 Requirement 1. Compute Penestrie, Inc.’s net cash provided by operating activities during March.

Use the indirect method.

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