Consider the following: Net Income Depreciation Expense Gain on Sale of Land Increase in Inventory Increase in Wages Payable Payment of Dividends Calculate the net cash provided (or used) by operating activities using the indirect method. Select one: $51,900 36,000 22,500 6,150 18,450 6,000 A. $38,100 B. $77,700 C. $107,700 D. $71,700

Consider the following: Net Income Depreciation Expense Gain on Sale of Land Increase in Inventory Increase in Wages Payable Payment of Dividends Calculate the net cash provided (or used) by operating activities using the indirect method. Select one: $51,900 36,000 22,500 6,150 18,450 6,000 A. $38,100 B. $77,700 C. $107,700 D. $71,700

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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X company uses the indirect method to determine its cash flows from operating activities. Determine its net cash provided or used by operating activities, using the following information. Depreciation expense Net income Increase in inventory Cash payment on note payable Gain on sale of land Increase in accounts payable $100,000 $182,000 $18.000 $50.000 $30,000 $48.500 a. $282,500 provided by operating activities. b. $232,500 provided by operating activities. c. $182,500 provided by operating activities. d. $318,500 provided by operating activities.
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A draft statement of cash flows contains the following: £ i Profit before tax 22 ii Depreciation 8 iii Increase in inventories -4 iv Decrease in receivables -3 v Increase in payables -2 Net cash inflow from operating activities 21 Which Two of the following corrections needs to be made to the calculation? a. ii and v b. iv and iii c. i and ii d. iv and v
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D. MATCHING In the following statement of cash flows, each letter represents a specific item which may appear on the statement, using the indirect method. Match the appropriate letter(s) with each transaction listed below. More than one letter may be used for each transaction. 1) 2) 3) 4) 5) 6) 7) 8) 9) Statement of Cash Flows Cash Flows from Operating Activities: Net Income Adjustments to Net Income: Add Deduct Cash Flows from Investing Activities Add Deduct Cash Flows from Financing Activities Add Deduct Significant Non-Cash Transactions Not on the Statement of Cash Flows (A) (B) (D) 30 000€ (H) Sold a short-term, available-for-sale investment at a gain. Temporarily borrowed money by signing a short-term, promissory trade notes payable. Treasury stock was purchased with cash. Declared cash dividends (but did not pay them yet). Purchased land by giving shares of common stock held in treasury. Amortized the premium on bonds payable. Paid off bonds payable before maturity and incurred a…
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