Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Pearl SA uses the direct method to prepare its statement of cash flows. Pearl's trial balances at December 31, 2022 and 2021, are as follows.

Pearl SA uses the direct method to prepare its statement of cash flows. Pearl's trial balances at December 31, 2022 and 2021, are as follows.

December 31

Debits

2022

2021

Cash

R$36,000

R$34,000

Accounts receivable

36,000

30,000

Inventory

31,000

49,000

Property, plant, & equipment

100,000

95,000

Cost of goods sold

254,000

384,000

Selling expenses

147,500

176,000

General and administrative expenses

144,000

153,300

Interest expense

4,300

2,600

Income tax expense

20,400

61,200

R$773,200

R$985,100

Credits

Allowance for doubtful accounts

R$1,400

R$1,400

Accumulated depreciation

17,000

14,000

Accounts payable

28,000

17,300

Income taxes payable

23,500

29,600

Deferred income taxes

6,000

5,300

8% callable bonds payable

40,500

15,000

Share capitalordinary

50,000

40,000

Share premiumordinary

9,100

7,500

Retained earnings

44,700

67,600

Sales revenue

553,000

787,400

R$773,200

R$985,100

Additional information:

1. Pearl purchased R$5,000 in equipment during 2022.
2. Pearl allocated one-third of its depreciation expense to selling expenses and the remainder to general and administrative expenses.
3. Bad debt expense for 2022 was R$5,000, and write-offs of uncollectible accounts totaled R$5,000.
4. Interest expense includes R$500 of discount amortization.

Determine what amounts Pearl should report in its statement of cash flows for the year ended December 31, 2022, for the following items.image text in transcribed

Determine what amounts Pearl should report in its statement of cash flows for the year ended December 31, 2022, for the following items. (a) Cash collected from customers. R $ 559000 (b) Cash paid to suppliers. R$ 225300 (c) Cash paid for interest. R$ 3800 (d) Cash paid for income taxes. R$ 25800 (e) Cash paid for selling expenses. R$ 147,500

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Students also viewed these Accounting questions