18. Alex Company prepares its statement of cash flows using the direct method fo

Question

18. Alex Company prepares its statement of cash flows using the direct method for operating activities. For the year ended December 31, 2011, Alex Company reports the following activity: Sales on account $1,300,000 Cash sales 740,000 Decrease in accounts receivable 610,000 Increase in accounts payable 72,000 Increase in inventory 48,000 Cost of good sold 975,000 What is the amount of cash collections from customers reported by Alex Company for the year ended December 31, 2011? a. $2,040,000 b. $1,910,000 c. $2,650,000 d. $1,430,000 Alex Company prepares its statement of cash flows using the direct method for operating activities. For the year ended December 31, 2011, Alex Company reports the following activity: Sales on account Cash sales 740,000 Decrease in accounts receivable 610,000 Increase in accounts payable 72,000 Increase in inventory 48,000 Cost of goods sold 975,000 $1,300,000 What is the amount of cash payments to suppliers reported by Alex Company for the year ended December 31, 2011? a. S 951,000 b. 999,000 c. $1,095,000 d. 855,000

Explanation / Answer

18. ANSWER = B) $ 1,910,000

Collection from customer = Sales on account + Decrease in Accounts receivable

= 1,300,000 + 610,000

= 1910000

19. ANSWER = C) $1095000

Cash payment to suppliers = Credit purchases + Increase in accounts payable

= 1023000 + 72000

= 1095000

Purchase = Cost of goods sold + Increase in inventory

Purchase = 975000 + 48000 = 1023000

Related Questions

Navigate

• Browse (All)
• Browse 1
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.