Cash Flow from Operating Activities (Indirect Method) The Arcadia Company owns no plant assets and had the following income statement for the year: Sales revenue $930,000 Cost of goods sold $640,000 Wages expense 210,000 Rent expense 42,000 Utilities expense 11,000 903,000 Net income $27,000 Additional information about the company includes: End of Year Beginning of Year Accounts receivable $67,000 $59,000 Inventory 62,000 86,000 Prepaid rent 8,000 7,000 Accounts payable 22,000 28,000 Wages payable 9,000 7,000 Use the preceding information to calculate the cash flow from operating activities using the indirect method. Remember to use negative signs with answers when appropriate.

Cash Flow from Operating Activities (Indirect Method) The Arcadia Company owns no plant assets and had the following income statement for the year: Sales revenue $930,000 Cost of goods sold $640,000 Wages expense 210,000 Rent expense 42,000 Utilities expense 11,000 903,000 Net income $27,000 Additional information about the company includes: End of Year Beginning of Year Accounts receivable $67,000 $59,000 Inventory 62,000 86,000 Prepaid rent 8,000 7,000 Accounts payable 22,000 28,000 Wages payable 9,000 7,000 Use the preceding information to calculate the cash flow from operating activities using the indirect method. Remember to use negative signs with answers when appropriate.

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter15: Statement Of Cash Flows

Section: Chapter Questions

Problem 2PA: Statement of cash flowsindirect method The comparative balance sheet of Yellow Dog Enterprises Inc....

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	End of Year	Beginning of Year
Accounts receivable	$67,000	$59,000
Inventory	62,000	86,000
Prepaid rent	8,000	7,000
Accounts payable	22,000	28,000
Wages payable	9,000	7,000


Net Income	Answer
Add (deduct) items to convert net income to cash basis
Accounts Receivable	Answer	Answer
Inventory	Answer	Answer
Prepaid Rent	Answer	Answer
Accounts Payable	Answer	Answer
Wages Payable	Answer	Answer
Cash Provided by Operating Activities	Answer

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