Chapter 16

Lansing Companys current-year income statement and selected balance sheet data at December 31 of the current and prior years follow.

Lansing Company's current-year income statement and selected balance sheet data at December 31 of the current and prior years follow. LANSING COMPANY Income Statement For Current Year Ended December 31 Sales revenue $139,200 Expenses Cost of goods sold 56,000 Depreciation expense 19,000 Salaries expense 32,000 Rent expense 10,400 Insurance expense 5,200 Interest expense 5,000 Utilities expense 4,200 Net income $ 7,400 LANSING COMPANY Selected Balance Sheet Accounts At December 31 Current Year Accounts receivable $7,000 Inventory 3, 380 Accounts payable 5,800 Salaries payable 1,160 Utilities payable 500 Prepaid insurance 400 Prepaid rent 500 Prior Year $8,600 2,240 7,400 840 300 560 320 Problem 16-1A Indirect: Computing cash flows from operations LU P2 Required: Prepare the operating activities section of the statement of cash flows using the indirect method for the current year. (Amounts to be deducted should be indicated with a minus sign.) LANSING COMPANY Cash Flows from Operating Activities-Indirect Method For Current Year Ended December 31 Cash flows from operating activities: djustments to reconcile net income to net cash provided by operations: Lansing Company's current-year income statement and selected balance sheet data at December 31 of the current and prior years follow. LANSING COMPANY Income Statement For Current Year Ended December 31 Sales revenue $139,200 Expenses Cost of goods sold 56,000 Depreciation expense 19,000 Salaries expense 32,000 Rent expense 10,400 Insurance expense 5,200 Interest expense 5,000 Utilities expense 4,200 Net income $ 7,400 LANSING COMPANY Selected Balance Sheet Accounts At December 31 Current Year Accounts receivable $7,000 Inventory 3, 380 Accounts payable 5,800 Salaries payable 1,160 Utilities payable 500 Prepaid insurance 400 Prepaid rent 500 Prior Year $8,600 2,240 7,400 840 300 560 320 Problem 16-2AB Direct: Computing cash flows from operations LO P5 Required: Prepare the operating activities section of the statement of cash flows using the direct method for the current year. (Amounts to be deducted should be indicated with a minus sign.) LANSING COMPANY Cash Flows from Operating Activities-Direct Method For Current Year Ended December 31 Cash flows from operating activities