Question

1.

A firm reported salary expense of $237,000 for the current year. The beginning and ending balances in salaries payable were $37,000 and $10,000, respectively. What was the amount of cash paid for salaries? Multiple Choice $284,000. $237,000. $264,000 $210,000.

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4.

Answer 1

1	The correct answer is option $234000. See the account below
	Salaries Payable A/c
	To Cash A/c		$264,000		By Balance b/d		$37,000
	(Balancing Figure)				By Salaries Expense		$237,000
	To Balance c/d		$10,000
			$274,000				$274,000
2	The Correct answer is $77000. See below
		Net Cash provided by operating activities
		Cash Sales					$48,000
		Add: Collections on accounts receivables					$82,000
		Less:Payment to suppliers					$ (53,000.00)
		Net Cash provided by operating activities					$77,000
3	Accounts payable A/c Dr.				$295,000
	To cash A/c					$295,000
	(Reason: See below)
	Inventory A/c
	To Balance b/d		$33,000		By Cost of goods sold		$298,000
					By Balance c/d		$21,500
	To Accounts Payable		$286,500
	(Balancing Figure)
			$319,500				$319,500
	Accounts Payable A/c
	To Cash A/c		$295,000		By Balance b/d		$65,000
	(Balancing Figure)				By Purchase A/c		$286,500
	To Balance c/d		$56,500		(Inventory)
			$351,500				$351,500
4	Cash Flow from Operating Activities:
	Net Income					$     309,000
	Adjustments For non Cash effects:
	Depreciation expense				$        19,500
	Amortization of bond premium				$          3,900
						$        23,400
	Adjustments For non Operaing Activities effects:
	Cash dividend				$        29,000
						$        29,000
	Changes in operating Assets and liabilities:
	Increase in Inventory				$        (2,450)
	Increase in accounts receivables				$        (1,490)
	Decrease in interest payable				$        (1,690)
	Increase in accounts payable				$          7,900
						$          2,270
	Net cash flows from operating activities					$     363,670