The 2014 accounting records of Rogan Transport reveal these transactions and eve

Question

The 2014 accounting records of Rogan Transport reveal these transactions and events.

Prepare the cash flows from operating activities section using the direct method.

Payment of interest $ 30,450 Payment of salaries and wages $ 161,385 Cash sales 146,160 Depreciation expense 48,720 Receipt of dividend revenue 54,810 Proceeds from sale of vehicles 2,472,540 Payment of income taxes 36,540 Purchase of equipment for cash 66,990 Net income 115,710 Loss on sale of vehicles 9,135 Payment for merchandise 295,365 Payment of dividends 42,630 Payment for land 225,330 Payment of operating expenses 85,260 Collection of accounts receivable 593,775 Prepare the cash flows from operating activities section using the direct method. (Show amounts that decre Rogan Transport For the Year 2014 Statement of Cash Method Cash Flows from Operating Activities Cash Receipts from Customers 146160 Dividend Revenue 54,810 200970 Less ·Cash nts To Suppliers for Merchandise For Operating Expenses For Income Taxes For Interest For Salaries and Wages 295,365 85,260 36,540 30,450 161,385 pliers 609000 Net Decrease in Cash -408030

Explanation / Answer

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it is assumed that all sales are in cash, hence collection of accounts receivables is not considered.

interst can be classfied as financial activities if it is paid on loan or other financial instrument taken by the compnay.

Payment of interest 30,450 OA Cash sales 1,46,160 OA Receipt of dividend revenue 54,810 IA Payment of income taxes 36,540 OA Net income 1,15,710 NA Payment for merchandise 2,95,365 OA Payment for land 2,25,330 IA Collection of accounts receivable 5,93,775 OA Payment of salaries and wages 1,61,385 OA Depreciation expense 48,720 NA Proceeds from sale of vehicles 24,72,540 IA Purchase of equipment for cash 66,990 IA Loss on sale of vehicles 9,135 IA Payment of dividends 42,630 FA Payment of operating expenses 85,260 OA*

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