Brief Exercise 23-5 Pina Corporation had the following 2017 income statement. Sa

Question

Brief Exercise 23-5 Pina Corporation had the following 2017 income statement. Sales revenue Cost of goods sold Gross profit Operating expenses (includes depreciation of $23,000) Net income $207,000 128,000 79,000 50,000 $29,000 The following accounts increased during 2017: Accounts Receivable $10,000, Inventory $10,000, Accounts Payable $14,000. Prepare the cash flows from operating activities section of Pina's 2017 statement of cash flows using the indirect method. (Show amounts that decrease cash flow with either a -sign e.g. -15,000 or in parenthesis e.g. (15,000).) Pina Corporation Statement of Cash Flows-Indirect Method (Partial) For the Year Ended December 31, 201 Cash Flows from Operating Activities Cash Recelived from Customers Adjustments to reconcile net income to

Explanation / Answer

Particulars Amount Net Income as per income statement 29000 Add: Depreciation 23000 Net Profit before working capital changes and Non Operating activities 52000 Add: Increase in account payable 14000 Less: Increase in inventory 10000 Less: Increase in Account receivable 10000 CASH FLOW FROM OPERATING ACTIVITIES (A) 46000

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