Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The income statement of Indigo Company is shown below. INDIGO COMPANY INCOME STATEMENT FOR THE YEAR ENDED DECEMBER 31, 2017 Sales revenue $ 6,630,000 Cost

The income statement of Indigo Company is shown below.

INDIGO COMPANY INCOME STATEMENT FOR THE YEAR ENDED DECEMBER 31, 2017

Sales revenue

$ 6,630,000

Cost of goods sold
Beginning inventory

$ 1,840,000

Purchases

4,520,000

Goods available for sale

6,360,000

Ending inventory

1,530,000

Cost of goods sold

4,830,000

Gross profit

1,800,000

Operating expenses
Selling expenses

450,000

Administrative expenses

660,000

1,110,000

Net income

$ 690,000

Additional information:

1. Accounts receivable decreased $ 290,000 during the year.
2. Prepaid expenses increased $ 180,000 during the year.
3. Accounts payable to suppliers of merchandise decreased $ 260,000 during the year.
4. Accrued expenses payable decreased $ 120,000 during the year.
5. Administrative expenses include depreciation expense of $ 60,000.

Prepare the operating activities section of the statement of cash flows for the year ended December 31, 2017, for IndigoCompany, using the indirect method. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).)

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

Step: 3

blur-text-image

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

Cost Accounting A Managerial Emphasis Revised

Authors: Charles T. Horngren, Monte Wynder, William Maguire, Rebecca Tan, Srikant Datar, Lester E. Heitger

1st Australian Edition

1442554770, 978-1442554771

More Books

Students also viewed these Accounting questions

Question

five threads are accessing a shared resource

Answered: 1 week ago

Question

1.4 Identify tools to help makeevidence-based HRM decisions.

Answered: 1 week ago