Question

Week 12 Chapter 21 Homework - Part 2 Check my work mode: This shows what is correct or incorrect for the work you have completed so far. It does not indicate completion The following schedule relates the income statement with cash flows from operating activities, derived by both the direct and indirect methods. Some elements necessary to complete the schedule are missing Required: Complete the schedule by determining each of the following missing elements (Amounts to be deducted should be indicated with a minus sign) Answer is not complete. Canh Bowstrom Operating Activities indirect Method Income Statement Direct Method 15 (33) Cash received from customers Not reported nochette Decrease in accounts receivable Ganon of equipment In v ertory Increase in counts payable Cost of goods sold 189 (13) (45) 23 Cahad to piers Cashpad to engles Cashpad for depreciation Cashpad forest Cashpad for insurance Nordhet Chad for comes Net cash flows from operating activities Incense Loss one of land income tax expense Decrease in bond discount Decrease in pred ance toneland Increase in income tax payable Net cash flows from operating activities 15 (45) 57 $ 117

Answer 1

Income Statement Particulars Amount $414 Sale Gain on Sale of Equipment -$33 -$21 Cash Flow from Operating Activities Indirect Method Direct Method Amount Particulars Amount Particulars Net Income $43 Adjustments $399 Decrease in Account Recievable $15 Cash Recieved from Customers $33 Gain on Sale of Equipment Increase in Inventory -$189 Increase in Accounts Payable $27 Cash paid to Supplier -$60 Increase in Salary Payable $15 Cash Paid to Employees -$18 Depreciation Expenses $18 Cash paid for Depreciation -$23 -$39 Decrease in Bond Discount $5 Cash Paid for interest expenses -$15 Decrease in Prepaid Insurance $18 Cash Paid for insurance -S45 Loss on Sale of Land $15 Increase in income tax payable $15 Cash paid for Income Tax $43 Net cash from operating Activities $117 Net cash from operating Activities Cost of Good Sold Salaries Expenses Depreciation Expenses Interest Expenses Insurance Expenses Loss on Sale of Land Income Tax Exenses -$183 -$45 -$18 -$21 -$30 $117|| Net Income

Working a) Cost of Good Sold Cash paid to Supplier = 183 Purchase = Cash paid to Supplier + Increase in Accounts Payable Purchase = 183 + 27 Purchase = 210 Cost of Good Sold = Purchase - Increase in Inventory Cost of Good Sold = 210-21 Cost of Good Sold = 189 b) Interest Expenses Interest Expenses = Cash paid for Interest +Decrease in Bond Discount Interest Expenses = 18 +5 Interest Expenses = 23 c) Increase in income tax payable = Income Tax Expenses - Income tax paid Increase in income tax payable = 45 - 30 Increase in income tax payable = 15 d) Cash Recieved from Customers Cash Recieved from Customers = Sales + Decrease in Account Recievable Cash Recieved from Customers = 399 + 15 Cash Recieved from Customers = 414 e) Cash Paid for insurance Cash Paid for insurance = Insurance Expenses - Decrease in Prepaid Insurance Cash Paid for insurance = 39 - 18 Cash Paid for insurance = 21 f) Salaries expense is $60 and cash paid to Employess is $45. So the now now amount $15 (60-45) is increses in salry payable only. g) Depreciation is non cash expense Threfore, Cash paid for depreciation is $0