The two independent cases are listed below: Sales Revenue $ 12,800 $ 10,800 $ 30

Question

The two independent cases are listed below: Sales Revenue $ 12,800 $ 10,800 $ 30,000 $ 19,800 Cost of goods Sold 6,900 6,400 15,600 11,900 Gross Profit 5,900 4,400 14,400 7,900 Depreciation Expense 1,180 1,180 1,680 1,680 Salaries and Wages Expense 3,400 2,180 6,800 5,180 Net Income 1,320 1,040 5,920 1,040 Accounts Receivable 390 490 840 690 Inventory 840 590 910 890 Accounts Payable 980 880 890 1,030 Salaries and Wages Payable 2,800 1,380 290 340 Compute the net cash flow from operating activities section of the Year 2 statement of cash flows using the direct method. (Amounts to be deducted should be indicated with a minus sign.) Cash Collected from Customers Cash Payments to Suppliers Cash Payments for Salaries and Wages Net Cash Provided by Operating Activities

Explanation / Answer

Particulars Case A Case B Cash Collected from Customer 12900 29850 Cash paymens to Suppliers -7050 -15760 Cash payments for Salaries and Wages -1980 -6850 Net Cash provided by Operating activities 3870 7240 Cash Collected from Customer Case A Case B Opening AR balance 490 690 +Sales in Year 2 12800 30000 -Ending AR balance 390 840 Collections 12900 29850 Cash paymens to Suppliers Case A Case B Opening AP balance 880 1030 +Purchases in Year 2 7150 15620 -Ending AP balance 980 890 Payments 7050 15760 Purchases in Year 2 Case A Case B Ending Inventory Year 2 840 910 +COGS Year 2 6900 15600 -Beginning Inventory Year 2 590 890 Purchases in Year 2 7150 15620 Cash payments for Salaries and Wages Case A Case B Salaries and wages expense 3400 6800 + Opening Salaries payable 1380 340 -Ending salaries payable 2800 290 Cash payments for Salaries and Wages 1980 6850

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