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).

FINANCIAL ACCOUNTING
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ISBN:9781259964947
Author:Libby
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Chapter1: Financial Statements And Business Decisions
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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.

 

  1. dentify the amount that should be reported as net cash flow from operating activities.
  2. Identify the amount that would be included in net income.
  3. Show how the indirect method would convert net income (requirement 3) to net cash flow from operating activities (requirement 2).

 

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