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Calculate operating cash flows using the direct method. (Note: Begin by entering the applicable income statement amounts. In the Adjustments column, if an account has
Calculate operating cash flows using the direct method. (Note: Begin by entering the applicable income statement amounts. In the Adjustments column, if an account has more than one adjustment, enter the total effect of all adjustments in the applicable cell. Use a minus sign to indicate a negative adjustment or a negative cash outflow. Refer to the Amount Descriptions list provided for the exact wording of the answer choices for text entries.)
Booth Manufacturing Comparative Balance Sheets At December 31, 20X1 and 20X2 1 20X1 20X2 2 Assets 3 Cash $112,500.00 $350,000.00 4 Accounts receivable 350,000.00 281,250.00 5 Inventories 125,000.00 150,000.00 1,000,000.00 1,025,000.00 6 Plant and equipment Accumulated depreciation 7 (500,000.00) (525,000.00) 8 Land 500,000.00 718,750.00 9 Total assets $1,587,500.00 $2,000,000.00 10 Liabilities and equity 11 Accounts payable $300,000.00 $237,500.00 12 Mortgage payable 250,000.00 13 Common stock 75,000.00 75,000.00 14 Paid-in capital in excess of par 300,000.00 300,000.00 15 Retained earnings 912,500.00 1,137,500.00 16 Total liabilities and equity $1,587,500.00 $2,000,000.00 Booth Manufacturing Income Statement For the Year Ended December 31, 20X2 1 Revenues $1,200,000.00 2 Gain on sale of equipment 50,000.00 3 Cost of goods sold 4 Depreciation expense (640,000.00) (125,000.00) (35,000.00) $450,000.00 5 Interest expense 6 Net income Other information includes: (a) Equipment with a book value of $125,000 was sold for $175,000 (original cost was $225,000) and (b) Dividends of $225,000 were declared and paid. Required: Calculate operating cash flows using the direct method. Amount Descriptions Refer to the list below for the exact wording of a label or an amount description within your income statement. Amount Descriptions Cost of goods sold Depreciation expense Gain on sale of equipment Interest expense Loss on sale of equipment Net cash from operating activities Net income Net loss Revenues Booth Manufacturing Operating Cash Flows For the Year Ended September 30, 20X2 Income 1 Adjustments Cash Flows Statement 2 Cash flows from operating activities: 3 4 5 6 7 8Step by Step Solution
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