Question

Nitrogen Inc. had the following events occur in 2017. Calculate the cash receip or cash disbursements for each event. a. Taxes Payable on January 1 was $12,400 and on December 31 was $13,600. Income Tax Expense on the income statement was reported at $39,000. b. Cost of goods sold on the income statement was reported at $50,000. Accour Payable increased $5,000 and Inventory decreased $7,000. c. Sales were reported on the income statement at $100,000. Accounts Receivab increased $5,700. d. Interest Revenue on the income statement was reported at $12,000. Interest Receivable decreased $3,600. e. Salary Expense on the income statement was reported at $55,000. Salary Payable increased $3,900.

Answer 1

a.	Cash disbursements:
	+ Taxes payable, January 1	12,400
	+ Income tax expense	39,000
	- Taxes payable, December 31	(13,600)
		37,800
b.	Cash disbursements:
	+ Cost of goods sold	50,000
	- Accounts payable increased	(5,000)
	- Inventory decreased	(7,000)
		38,000
c.	Cash receipts
	+ Sales	100,000
	- Accounts receivable increased	(5,700)
		94,300
d.	Cash receipts
	+ Interest Revenue	12,000
	+ Interest receivable decreased	3,600
		15,600
e.	Cash disbursements:
	+ Salary expense	55,000
	- Salary payable increased	(3,900)
		51,100