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The income statement and a schedule reconciling cash flows from operating activities to net income are provided below for Macrosoft Corporation MACROSOFT CORPORATION Income Statement
The income statement and a schedule reconciling cash flows from operating activities to net income are provided below for Macrosoft Corporation
MACROSOFT CORPORATION Income Statement For the Year Ended December 31, 2021 ($ in millions) | ||||||
Revenues and gains: | ||||||
Sales | $ | 306.00 | ||||
Gain on sale of cash equivalents | 1.80 | |||||
Gain on sale of investments | 23.80 | $ | 331.60 | |||
Expenses and loss: | ||||||
Cost of goods sold | $ | 118.00 | ||||
Salaries | 39.80 | |||||
Interest expense | 11.80 | |||||
Insurance | 19.80 | |||||
Depreciation | 9.80 | |||||
Patent amortization | 3.80 | |||||
Loss on sale of land | 5.80 | 208.80 | ||||
Income before tax | 122.80 | |||||
Income tax expense | 61.40 | |||||
Net income | $ | 61.40 | ||||
Reconciliation of Net Income to Net Cash Flows from Operating Activities ($ in millions) | |||
Net income | $ | 61.40 | |
Adjustments for noncash effects: | |||
Depreciation expense | 9.80 | ||
Patent amortization expense | 3.80 | ||
Loss on sale of land | 5.80 | ||
Gain on sale of investment | (23.80 | ) | |
Decrease in accounts receivable | 5.80 | ||
Increase in inventory | (11.80 | ) | |
Increase in accounts payable | 17.80 | ||
Decrease in bond discount | 0.80 | ||
Increase in salaries payable | 5.80 | ||
Decrease in prepaid insurance | 3.80 | ||
Increase in income tax payable | 9.80 | ||
Net cash flows from operating activities | $ | 89.00 | |
Required:
Prepare the cash flows from operating activities section of the statement of cash flows (direct method). (Enter your answers in millions rounded to 2 decimal places (i.e., 5,500,000 should be entered as 5.50). Amounts to be deducted should be indicated with a minus sign.)
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