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Cash Flow from Operating Activities (Indirect Method) The Azuza Company owns no plant assets and had the following income statement for the year: Sales revenue
Cash Flow from Operating Activities (Indirect Method)
The Azuza Company owns no plant assets and had the following income statement for the year:
Sales revenue | $930,000 | |
Cost of goods sold | $650,000 | |
Wages expense | 210,000 | |
Rent expense | 42,000 | |
Utilities expense | 12,000 | 914,000 |
Net income | $16,000 |
Additional information about the company includes:
End of Year | Beginning of Year | |
---|---|---|
Accounts receivable | $67,000 | $59,000 |
Inventory | 62,000 | 86,000 |
Prepaid rent | 9,000 | 7,000 |
Accounts payable | 22,000 | 30,000 |
Wages payable | 9,000 | 7,000 |
Use the preceding information to calculate the cash flow from operating activities using the indirect method.
Remember to use negative signs with answers when appropriate.
Cash Flow from Operating Activities | |||
---|---|---|---|
Net Income | Answer | ||
Add (deduct) items to convert net income to cash basis | |||
Accounts Receivable | AnswerIncreaseDecrease | Answer | |
Inventory | AnswerIncreaseDecrease | Answer | |
Prepaid Rent | AnswerIncreaseDecrease | Answer | |
Accounts Payable | AnswerIncreaseDecrease | Answer | |
Wages Payable | AnswerIncreaseDecrease | Answer | |
Cash Provided by Operating Activities | Answer |
Please answer all parts of the question.
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