Question

Question Help Compute the net cash flow from operating activities for Claremore Company under the indirect reporting format. Claremore Company provided you with the following information for the current year. Accounts Payable relate to Selling, General and Administrative Expenses. EE(Click the icon to view the statement of net income.) EEB (Click the icon to view the changes in balance sheet accounts.) Requirement Compute net cash flow from operating activities under the indirect reporting format. (Use a minus sign or parentheses for any numbers to be subtracted. If a box is not used in the statement, leave the box empty; do not select a label or enter a zero.) Claremore Company Statement of net income Partial Statement of Cash Flows (Indirect Method) Changes in balance sheet accounts For the Year Ended December 31 Operating Activities: Claremore Company Account Changes from the Balance Sheet Amount Statement of Net Income Adjustments to Reconcile Net Income to Cash Flows Decrease in Accounts Receivable $ 1,200 For the Current Year Ended from Operating Activities: Decrease in Accounts Payable 650 38,000 Sales $ Increase in Wages Payable 2,400 Depreciation Expense (6,200) (35,000) Selling, General, and Administrative Expenses Changes in Current Assets and Liabilities Gain on Sale of Equipment 1,800 Print Done (3,470) Other Expenses Income before Taxes (4,870) 500 Tax Benefit (4,370) Net Loss Net Cash Provided (Used) by Operating Activities Print Done

Answer 1

Statement of Cash Flows - Indirect Approach
	Amount in $	Amount in $
Net income		$              -4,370
Cash flows from operating activities
Adjustments for reconcile the net income to:
Depreciation	$                6,200
Gain on sale of Equipment	$              -1,800
Decrease in account receivable	$                1,200
Decrease in account payable	$                  -650
Increses in wages payable	$                2,400
		$                7,350
Net cash from operating activities		$                2,980