Question
Cash Flows from Operating ActivitiesIndirect Method Selected data (in thousands) derived from the income statement and balance sheet of National Beverage Corp. for a recent
Cash Flows from Operating ActivitiesIndirect Method
Selected data (in thousands) derived from the income statement and balance sheet of National Beverage Corp. for a recent year are as follows:
Income statement data: | |
Net income | $49,340 |
Gain on disposal of property | 1,230 |
Depreciation expense | 11,620 |
Other items involving noncash expenses | 1,380 |
Balance sheet data: | |
Increase in accounts receivable | 1,755 |
Decrease in inventory | 1,010 |
Increase in prepaid expenses | 595 |
Decrease in accounts payable | 670 |
Decrease in accrued and other current liabilities | 1,015 |
a. Prepare the Cash flows from operating activities section of the statement of cash flows, using the indirect method for National Beverage Corp. Use the minus sign to indicate cash outflows, cash payments, decreases in cash, or any negative adjustments. Enter the amounts in thousands of dollars, as shown above.
National Beverage Co. | ||
Cash Flows from Operating Activities | ||
(in thousands) | ||
Cash flows from (used for) operating activities: | ||
$ | ||
Adjustments to reconcile net income to net cash flow from operating activities: | ||
Changes in current operating assets and liabilities: | ||
Net cash flow from operating activities | $ | |
b. The company has earnings and net cash flow from operating activities. The increase in accounts receivable indicates a(n) in sales. In addition, the company is using its cash to decrease its accounts payable balance, which indicates that the company is . Overall, National Beverage is doing financially.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started