Answered step by step
Verified Expert Solution
Link Copied!
Question
1 Approved Answer

The income statement disclosed the following items for the year: Depreciation expense $52,200 Gain on disposal of equipment 30,450 Net income 361,700 The changes in

The income statement disclosed the following items for the year: Depreciation expense $52,200 Gain on disposal of equipment 30,450 Net income 361,700 The changes in the current asset and liability accounts for the year are as follows: Accounts receivable Inventory Prepaid insurance Increase (Decrease) $8,130 (4,630) (1,740) (5,510) Accounts payable Income taxes payable Dividends payable 1,740 1,220 a. Prepare the "Cash flows from operating activities" section of the statement of cash flows, using the indirect method. Use the minus sign to indicate cash out flows, cash payments, decreases in cash, or any negative adjustments. Statement of Cash Flows (partial) Cash flows from operating activities: Adjustments to reconcile net income to net cash flow from operating activities: Changes in current operating assets and liabilities: Net cash flow from operating activities b. Why is net cash flows from operating activities different than net income? Cash flows from operating activities is based on of accounting, whereas net income is computed using of accounting

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image
Get Instant Access to Expert-Tailored Solutions

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

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

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

Get Started

Recommended Textbook for

Management Accounting A Decision Emphasis

Authors: Don T. DeCoster, Eldon L. Schafer, Mary T. Ziebell

4th Edition

0471637130, 978-0471637134

More Books

Students explore these related Accounting questions