7. Pearl Corporation’s accumulated depreciation—furniture account increased by $

Question

7. Pearl Corporation’s accumulated depreciation—furniture account increased by $6,750, while $2,660 of patent amortization was recognized between balance sheet dates. There were no purchases or sales of depreciable or intangible assets during the year. In addition, the income statement showed a loss of $4,390 from the sale of land.

Reconcile a net income of $106,850 to net cash flow from operating activities

The section of the statement of cash flows that reports the cash transactions affecting the determination of net income.

. Refer to the Amount Descriptions list provided for the exact wording of the answer choices for text entries.

Reconcile a net income of $106,850 to net cash flow from operating activities

The section of the statement of cash flows that reports the cash transactions affecting the determination of net income.

. Refer to the Amount Descriptions list provided for the exact wording of the answer choices for text entries.

1

Net income

2

Adjustments to reconcile net income to net cash flow from operating activities:

3

4

5

6

Solution

1

Net income

2

Adjustments to reconcile net income to net cash flow from operating activities:

3

4

5

6

1

Net income

2

Adjustments to reconcile net income to net cash flow from operating activities:

3

4

5

6

Explanation / Answer

The section of the statement of cash flows that reports the cash transactions affecting the determination of net income

2

Adjustments to reconcile net income to net cash flow from operating activities:

3

Depreciation expenses

6750

4

Amortization expenses

2660

5

Loss on sale of land

4390

6

Net cash flow from operating activities

120650

1. Net Income 106850

2

Adjustments to reconcile net income to net cash flow from operating activities:

3

Depreciation expenses

6750

4

Amortization expenses

2660

5

Loss on sale of land

4390

6

Net cash flow from operating activities

120650

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