complette the statement of cash flow (indirect method) shown below by using form
ID: 2572037 • Letter: C
Question
complette the statement of cash flow (indirect method) shown below by using formulas that refrence data from the income statement and balance sheet.
Note: To complete the assignment, go to the worksheet tab labeled Cash Flow and complete the statement of cash flows. INNOVATION ELECTRONICS, INC Income Statement For the Year Ended December 31, 20X2 Net sales Gain on sale of land S 2,430,000 6,500 Total revenues 2,436,500 Expenses: Cost of goods sold Operating expenses Depreciation expense Interest expense Income tax expense $ 1.565,000 598,000 16,000 17,000 63,000 Total expenses 2,259,000 Net income $ 177,500Explanation / Answer
Innovation Electronics Inc.
Statement of Cash Flow (Indirect Method) for
the year ended December 31, 20X2:- (Amount in $)
1) Increase in Current Assets and Decrease in current Liabilities is to be deducted and Decrease in Current assets and Increase in Current Liabilities is to be added to reconcile the net income to net cash provided by operating activities. .
Cash Flows from Operating Activities: Net Income 177,500 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation Expense 16,000 Gain on sale of land (6,500) Changes in Current assets and Current liabilities: Accounts Receivable (68,700-83,000) 14,300 Inventory (134,500-128,000) (6,500) Prepaid Insurance (2,980-4,560) 1,580 Accounts payable (26,500-81,000) (54,500) Interest payable (3,400-2,300) 1,100 Income tax payable (30,200-32,500) (2,300) Net cash provided by (used in) operating activities 140,680 Cash Flows from Investing Activities: Purchase of Investments (211,000-120,000) (91,000) Sale of Land (46,500+6,500) 53,000 Net Cash provided by (used in) investing activities (38,000) Cash flows from Financing Activities: Issue Common Stock (273,000-230,000) 43,000 Issue Long term Note (255,000-242,000) 13,000 Net cash provided by (used in) financing activities 56,000 Net increase (decrease) in cash 158,680 Cash at beginning of the period 25,740 Cash at end of the period 184,420Related Questions
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