Changes in current asset and current liability accounts for the year that relate

Question

Changes in current asset and current liability accounts for the year that relate to operations follow.

Required:

value: 5.00 points Exercise 12-4 Indirect: Cash flows from operating activities LO P2 The following income statement and information about changes in noncash current assets and current liabilities are reported SONAD COMPANY Income Statement For Year Ended December 31, 2015 Sales Cost of goods sold $ 1,828,000 991,000 837,000 Gross profit Operating expenses Salaries expense Depreciation expense Rent expense $ 245,535 44,200 49,600 4,200 18,125 Utilities expense 361,660 475,340 6,200 Gain on sale of equipment Net income S 481,540 Changes in current asset and current liability accounts for the year that relate to operations follow Accounts receivable30,500 increase Accounts payable $12,500 decrease Inventory 25,000 increase Salaries payable 3,500 decrease

Explanation / Answer

Answer : CASH FLOW STATEMENT

Cash flow from operating activities Net Income 481540 Add: Depreciation 44200 Amortization expense patents 4200 Less: Gain on sale of equipment -6200 Changes in current operating assets and liablities Increase in Accounts Receivable -30500 Increase in Inventory -25000 Decrease in Accounts payable -12500 Decrease in salaries payable -3500 Net cash provided by Operating activities $ 452240

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