Pad ??6:03 *99%- Compute Cash From Operating Activity by the indirect method fro

ID: 2410929 • Letter: P

Question

Pad ??6:03 *99%- Compute Cash From Operating Activity by the indirect method from Income & Balance Sheets Sales Revenue Cost of goods sold Cash Accounts Receivable 55 30 50 200 20 80 40 10 30 60 200 (70) 70 200 Gross Profit Operating Expenses Depreciation Expense Operating Income Interest Expense Earnings Before Taxes Income Tax Expense Net Income Inventory Plant Assets Accumulated Dep'n Total Assets Accounts Payable Taxes Payable Long-term Note Common Stock Retained Earnings40 Total Liab. & Equity 265 15 50 60 100 20 40 60 100 70 25 15 70. In 2017, Cash from Operating Activity was: (This is an indirect cash flow calculation.) a. 25 b. 35 c. 15 d. 30 e. 40 71. In 2017, how much cash was paid on purchases of inventory? (This is a direct cash flow calculation.

Explanation / Answer

Net Income

Adjustments:-

Depreciation Exp

Increase A/c Receivable

-5

Decrease Inventory

Decrease A/c Payable

-5

Increase Tax Payable

Cash from Operating Activities

Option B is correct

(71) Closing Inventory + COGS – Opening Balance of Inventory + Opening Account Payable - Closing Account Payable

= 60 + 120 – 70 + 20 - 15 = 115