Q12

A. 1. If the company debited cost of goods sold and credited inventory for $640,000 during the year, what is the total amount of inventory purchases recorded on the debit side of the Inventory T-account and the credit side of the Accounts Payable T-account?

2. What is the total amount of the debits recorded in the Accounts Payable T-account during the year?

3. What does the amount of these debits represent?

B. 1. What is the combined amount and direction (+ or ) of the inventory and accounts payableadjustments to net income in the operating activities section of the statement of cash flows?

2. What does this amount represent?

C. 1. If the company debited income tax expense and credited income taxes payable $1,180 during the year, what is the total amount of the debits recorded in the Income Taxes Payable account?

2. What does the amount of these debits represent?

O Required information (The following information applies to the questions displayed below.] Ravenna Company is a merchandiser that uses the indirect method to prepare the operating activities section of its statement of cash flows. Its balance sheet for this year is as follows: Ending Beginning Balance Balance Cash $ 80, 800 $ 96, 800 Accounts receivable 65,400 70, 400 Inventory 87, 800 80,000 Total current assets 234,000 247,200 Property, plant, and equipment 234,000 224,000 Less accumulated depreciation 78,000 56,000 Net property, plant, and equipment 156,000 168,000 Total assets $ 390, 000 $ 415 , 200 Accounts payable $ 51, 200 $ 91,000 Income taxes payable 39, 800 51, 200 Bonds payable 96,000 80,000 Common stock 112, 000 96,000 Retained earnings 91,000 97,000 Total liabilities and stockholders' equity $ 390,000 $ 415, 200 During the year, Ravenna paid a $9,600 cash dividend and it sold a piece of equipment for $4,800 that had originally cost $10,800 and had accumulated depreciation of $7,200. The company did not retire any bonds or repurchase any of its own common stock during the year