Calculate each of the following amounts for Mike Roe Computers: (Enter your answ

Question

Calculate each of the following amounts for Mike Roe Computers: (Enter your answers in millions of dollars rounded to 2 decimal places.)

a) cash received from customers during the reporting period?

b) cash paid to suppliers of goods during the reporting period

c) cash paid to employees during the reporting period

d) cash paid for interest during the reporting period

e) cash paid for insurance during the reporting period

f) cash paid for income taxes during the reporting period

Prepare the cash flows from operating activities section of the statement of cash flows (direct method).(Enter your answers in millions of dollars rounded to 2 decimal places. Amounts to be deducted should be indicated with a minus sign.)

The income statement and a schedule reconciling cash flows from operating activities to net income are provided below ($ in millions) for Mike Roe Computers.

Explanation / Answer

CAsh received from customers = Net sales +decrease in Accounts Receivable

= 151+5.50 = 156.5

Cash paid to suppliers = Cost of goods sold +Increase in Inventory - increase in Accounts payable

= 90.50+6.50-9.50 = 87.5

CAsh Paid to Employees = salaries expense - Increase in salaries payable

= 21-3.50 = 17.5

CAsh paid for interest = Interest expense

=6.50

Cash paid for insurance = Insurance Expense - decrese in prepaid insurance

= 13 -2.50 = 10.5

CAsh paid for income tax = Income tax expense - increase in income tax payable

= 11.75-6.50 =5.25

Cash flows from Operating Activities

Cash Received from customers 156.5 CAsh Payment Suppliers (87.5) Employees (17.5) Interest (6.50) Insurance (10.5) Income tax (5.25) +Decrease in bond discount 3.25 CAsh Flow from operating Activities 32.50

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