The income statement for Tremblant Limited is presented here TREMBLANT LIMITED Y
ID: 2513316 • Letter: T
Question
The income statement for Tremblant Limited is presented here TREMBLANT LIMITED Year Ended December 31, 2015 Service revenue Operating expenses Profit from operations Interest expense Profit before income tax Income tax expense Profit $924,500 710,600 213,900 75,510 138,390 38,240 $100,150 Tremblant's statement of financial position contained these comparative data at December 31 2015 2014 Accounts receivable Prepaid expenses Accounts payable Salaries payable Unearned revenue Interest payable Income tax payable $56,360 12,570 34,110 17,870 11,970 6,660 4,800 $51,410 15,470 42,510 21,760 8,300 4,880 9,810 Additional Information 1. Operating expenses include depreciation expense, $49,910; amortization expense, $15,100; administrative expenses, $119,600; salaries expense, $500,610; and loss on the disposal of equipment, $25,380. 2. Unearned revenue is received from customers 3. Prepaid expenses and accounts payable relate to operating (administrative) expenses. Prepare the operating activities section of the statement of cash flows, using the indirect method. (Show amounts that decrease cash flow with either a -sign e.g.-45,000 or in parenthesis e.g. (45,000).)Explanation / Answer
Cashflows from Operating Activities: Net Income during the year 100150 Adjustment to reconcile the profits Depreciation expense 49910 Amortization expense 15100 loss on disposal of equipment 25380 Interest expense 75510 Increase in Accounts receivable -4950 Decrease in prepaid expense 2900 Decrease in Accounts payable -8400 Decrease in Salaries payable -3890 Increase in unearned revenue 3670 Decrease in taxes payable -5010 Net Cashflows provided from Operating Activities 250370 Note: Interest expense is treated as financing activities in the absence of other information.
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