The income statement and selected balance sheet information for Calendars Incorp

Question

The income statement and selected balance sheet information for Calendars Incorporated for the year ended December 31 is presented below. Income Statement Sales Revenue Expenses $72,000 Cost of Goods Sold Depreciation Expense 33,000 15,400 Salaries and Wages Expense 9,400 1.900 1,000 900 700 Rent Expense Insurance Expense Interest Expense Utilities Expense Net Income s 9,700 Selected Balance Sheet Accounts Ending Beginning Balances Balances Inventory Accounts Receivable Accounts Payable Salaries and Wages Payable Utilities Payable Prepaid Rent Prepaid Insurance s 435 1,500 1.360 610 110 90 65 500 1.260 1.620 330 120 80 Required Prepare the cash flovws from operating activities section of the statement of cash flows using the indirect method (Amounts to be deducted should be indicated by a minus sign.) pmethore out o be ded tcted shoultd be indicated by e minus sigh fows using the Indirect CALENDARS INCORPORATED Search the web and Windows

Explanation / Answer

Cash flow from operating activities:

Particulars Details Amount in $ Net Incomes 9700 Adjustments to reconcile net income to net cash provided by cash operating activities Add: Depreciation expense 15400 Add: Interest 900 Add: Decrease in inventory 65 Less: Increase in accounts receivable 240 Less: Decrease in accounts payable 260 Add:Increase in salaries & wages payable 280 Add: Increase in utilities payable 110 Add: Decrease in prepaid rent 30 Add: Decrease in prepraid insurance 15 16300 Cash generated from operating activities 26000

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