Suppose your company sells services of $180 in exchange for $110 cash and $70 on account. prepare journal entry a) Record the service revenue of $110 for cash and $70 on account. dentify the amount that should be reported as net cash flow from operating activities. Identify the amount that would be included in net income. Show how the indirect method would convert net income (requirement 3) to net cash flow from operating activities (requirement 2).
Suppose your company sells services of $180 in exchange for $110 cash and $70 on account. prepare journal entry a) Record the service revenue of $110 for cash and $70 on account. dentify the amount that should be reported as net cash flow from operating activities. Identify the amount that would be included in net income. Show how the indirect method would convert net income (requirement 3) to net cash flow from operating activities (requirement 2).
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Suppose your company sells services of $180 in exchange for $110 cash and $70 on account.
prepare
a) Record the service revenue of $110 for cash and $70 on account.
- dentify the amount that should be reported as net
cash flow from operating activities. - Identify the amount that would be included in net income.
- Show how the indirect method would convert net income (requirement 3) to net cash flow from operating activities (requirement 2).
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