Schedule for Calculation of Cash Generated From Operating Activities

Zowine Company's condensed income statement for the year ended December 31, 20-2, is shown.

Net sales	$765,000
Cost of goods sold	550,000
Gross profit	$215,000
Operating expenses	30,000
Income before taxes	$185,000
Income tax expense	65,000
Net income	$120,000

Additional information obtained from Zowine's comparative balance sheets as of December 31, 20-2 and 20-1, is shown.

	20-2		20-1
Cash		$60,000		$20,000
Accounts receivable		70,000		100,000
Merchandise inventory		80,000		125,000
Accounts payable		55,000		90,000

Required:

Question Content Area

1. Prepare a schedule for the calculation of cash generated from operating activities for Zowine Company for the year ended December 31, 20-2.

Zowine Company Schedule for the Calculation of Cash Generated from Operating Activities For Year Ended December 31, 20-2

	Income Statement	Additions	Deductions	Cash Flows
Net sales	$765,000	$fill in the blank c164dafa8fddf91_1		$fill in the blank c164dafa8fddf91_2
Cost of goods sold	550,000	fill in the blank c164dafa8fddf91_3	$fill in the blank c164dafa8fddf91_4	fill in the blank c164dafa8fddf91_5
Gross profit	$215,000			$fill in the blank c164dafa8fddf91_6
Operating expenses	30,000			fill in the blank c164dafa8fddf91_7
Income before taxes	$185,000			$fill in the blank c164dafa8fddf91_8
Income tax expense	65,000			fill in the blank c164dafa8fddf91_9
Net income	$120,000			$fill in the blank c164dafa8fddf91_10

Question Content Area

2. Prepare a partial statement of cash flows for Zowine Company reporting cash from operating activities under the direct method for the year ended December 31, 20-2.

Zowine Company Statement of Cash Flows (Partial) For the Year Ended December 31, 20-2

Cash flows from operating activities:
Cash received from customers		$fill in the blank e9b1f9faffbe02b_1
Cash paid for merchandise	$fill in the blank e9b1f9faffbe02b_2
Cash paid for operating expenses	fill in the blank e9b1f9faffbe02b_3
Cash paid for income taxes	fill in the blank e9b1f9faffbe02b_4
Total cash disbursed for operating activities		fill in the blank e9b1f9faffbe02b_5
Net cash provided by operating activities		$fill in the blank e9b1f9faffbe02b_6