Oregon Company is preparing its statement of cash flows using the indirect method. During the year, the company purchased equipment for $15,000 cash. Which of the following statements is true? O $15,000 would be shown as a positive cash flow in the investing activities section. O $15,000 would be shown as a positive cash flow in the financing activities section. O $15,000 would be shown as a negative cash flow in the operating activities section. O $15,000 would be shown as a negative cash flow in the investing activities section.

Oregon Company is preparing its statement of cash flows using the indirect method. During the year, the company purchased equipment for $15,000 cash. Which of the following statements is true? O $15,000 would be shown as a positive cash flow in the investing activities section. O $15,000 would be shown as a positive cash flow in the financing activities section. O $15,000 would be shown as a negative cash flow in the operating activities section. O $15,000 would be shown as a negative cash flow in the investing activities section.

Financial Accounting Intro Concepts Meth/Uses

14th Edition

ISBN:9781285595047

Author:Weil

Publisher:Weil

Chapter6: Statement Of Cash Flows

Section: Chapter Questions

Problem 34P

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During the year, Hepworth Company earned a net income of 61,725. Beginning and ending balances for the year for selected accounts are as follows: There were no financing or investing activities for the year. The above balances reflect all of the adjustments needed to adjust net income to operating cash flows. Required: 1. Prepare a schedule of operating cash flows using the indirect method. 2. Suppose that all the data are used in Requirement 1 except that the ending accounts payable and cash balances are not known. Assume also that you know that the operating cash flow for the year was 20,475. What is the ending balance of accounts payable? 3. CONCEPTUAL CONNECTION Hepworth has an opportunity to buy some equipment that will significantly increase productivity. The equipment costs 25,000. Assuming exactly the same data used for Requirement 1, can Hepworth buy the equipment using this years operating cash flows? If not, what would you suggest be done?
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