The statement of profit or loss of Bear’s Chairs Ltd is presented here. 

Additional information:

1. Accounts receivable increased $200 000 during the year.

2. Prepaid expenses increased $150 000 during the year.

3. Accounts payable to suppliers of inventory decreased $340 000 during the year.

4. Accrued expenses payable decreased $100 000 during the year. 

5. Administrative expenses include depreciation expense of $110 000.

Required

(a) Prepare the operating activities section of the statement of cash flows for the year ended 30 November 2015 for Bear’s Chairs Ltd using the direct method.

(b) Prepare the operating activities section of the statement of cash flows for the year ended 30 November 2015 for Bear’s Chairs Ltd, using the indirect method.  

Transcribed Image Text:

Sales Cost of sales Beginning inventory Purchases Goods available for sale Ending inventory Total cost of sales Gross profit Operating expenses Selling expenses BEAR'S CHAIRS LTD Statement of profit or loss for the year ended 30 November 2015 Administrative expenses Profit $1900 000 4 400 000 6 300 000 1400 000 450 000 700 000 $7 700 000 4900 000 2 800 000 1 150 000 $1650 000