(SCFDirect Method) Zurg Corp. uses the direct method to prepare its statement of cash flows. Zurgs trial balances at December 31, 2008 and 2007, are as follows.
2017 2016 Debits Accounts receivable Inventory Property, plant, &equipment Cost of goods sold Selling expenses General and administrative expenses Interest expense Income tax expense $ 84,000 270,000 187,000 690,000 1,205,000 181,500 285,000 8,500 170,300 $3,081,300 $ 5,000 298,000 171,000 592,100 1,080,000 106,000 189,500 10,200 161,800 $2,613,600 Credits Allowance for doubtful accounts Accumulated depreciation Trade accounts payable Income taxes payable Deferred income taxes Unamortized bond premium 10% convertible bonds payable Common stock Additional paid-in capital Retained earnings $ 9,600 80,500 95,000 21,000 $8,100 65,000 118,500 8,600 45,600 5,000 100,000 100,000 56,000 318,300 1,788,500 $2,613,600 100,000 110,000 75,000 425,700 2,105,800 $3,081,300 Additional information: 1. Zurg purchased a major piece of equipment for $97,900 during 2017. 2. Zurg allocated one-half of its depreciation expense to cost of goods sold and the remainder to general and administrative expenses. 3. Bad debt expense for 2017 was $10,000 and is included in general and administrative expenses. Instructions Determine what amounts Zurg should report in its statement of cash flows for the year ended December 31, 2017, for the follow- ing items. (a) Cash collected from customers. (b) Cash paid to suppliers. (c) Cash paid for interest. (d) Cash paid for income taxes. (e) Cash paid for general and administrative expenses. 2017 2016 Debits Accounts receivable Inventory Property, plant, &equipment Cost of goods sold Selling expenses General and administrative expenses Interest expense Income tax expense $ 84,000 270,000 187,000 690,000 1,205,000 181,500 285,000 8,500 170,300 $3,081,300 $ 5,000 298,000 171,000 592,100 1,080,000 106,000 189,500 10,200 161,800 $2,613,600 Credits Allowance for doubtful accounts Accumulated depreciation Trade accounts payable Income taxes payable Deferred income taxes Unamortized bond premium 10% convertible bonds payable Common stock Additional paid-in capital Retained earnings $ 9,600 80,500 95,000 21,000 $8,100 65,000 118,500 8,600 45,600 5,000 100,000 100,000 56,000 318,300 1,788,500 $2,613,600 100,000 110,000 75,000 425,700 2,105,800 $3,081,300 Additional information: 1. Zurg purchased a major piece of equipment for $97,900 during 2017. 2. Zurg allocated one-half of its depreciation expense to cost of goods sold and the remainder to general and administrative expenses. 3. Bad debt expense for 2017 was $10,000 and is included in general and administrative expenses. Instructions Determine what amounts Zurg should report in its statement of cash flows for the year ended December 31, 2017, for the follow- ing items. (a) Cash collected from customers. (b) Cash paid to suppliers. (c) Cash paid for interest. (d) Cash paid for income taxes. (e) Cash paid for general and administrative expenses
