Selected balance sheet information and the income statement for Fountainhead Cor
ID: 2473713 • Letter: S
Question
Selected balance sheet information and the income statement for Fountainhead Corporation for the current year are presented below.
Prior Year
Current Year
Required:
Prepare the cash flows from operating activities section of the statement of cash flows using the indirect method. (Enter any deductions and cash outflows as a negative value.)
Fountain Head Corporation
Cash Flows From Operating Activities
The options for cash flows are: Accounts Payable, Accounts Receivable, Depreciation, Gain on Sale of Equipment, Inventories, Prepaid Rent, and Salaries and Wages Payable
Selected Balance Sheet AccountsPrior Year
Current Year
Accounts Receivable $ 23,400 $ 16,000 Merchandise Inventory 32,000 35,200 Prepaid Rent 2,200 0 Accounts Payable 18,200 23,600 Salaries and Wages Payable 4,400 6,600Explanation / Answer
Statement of Cash Flow Particulars Amount Total Amount Income 52,000.00 Depreciation 32,000.00 Decrease in AR 7,400.00 Increase in inventory (3,200.00) Decrease in prepaid rent 2,200.00 Increase in AP 5,400.00 Increase in Salaries and wages payable 2,200.00 Cash flow from operating activities 98,000.00
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