VINCE GILL COMPANY INCOME STATEMENT FOR THE YEAR ENDED DECEMBER 31, 2014 Sales r

Question

VINCE GILL COMPANY INCOME STATEMENT FOR THE YEAR ENDED DECEMBER 31, 2014 Sales revenue $6,995,900 Cost of goods sold Beginning inventory $1,896,130 Purchases 4,440,220 Goods available for sale 6,336,350 Ending inventory 1,603,600 Cost of goods sold 4,732,750 Gross profit 2,263,150 Operating expenses Selling expenses 455,240 Administrative expenses 692,470 1,147,710 Net income $1,115,440 Additional information: 1. Accounts receivable decreased $318,930 during the year. 2. Prepaid expenses increased $175,990 during the year. 3. Accounts payable to suppliers of merchandise decreased $271,840 during the year. 4. Accrued expenses payable decreased $122,590 during the year. 5. Administrative expenses include depreciation expense of $55,780. Prepare the operating activities section of the statement of cash flows for the year ended December 31, 2014, for Vince Gill Company, using the indirect method. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).) VINCE GILL COMPANY Statement of Cash Flows (Partial) For the Year Ended December 31, 2014 $ Adjustments to reconcile net income to $ $ Link to Text

Explanation / Answer

Vince Gill Company Statement of Cash Flows (Partial) For the year ending December 31, 2014 Cash Flow from opearating activities: Net Income    1,115,440 Add/(Less) non cash effects on operating activities Depreciation expenses          55,780 Operating Profit before Working Capital Changes    1,171,220 Decrease in Accounts Receivables     318,930 Increase in Prepaid Expenses (175,990) Decrease in Accounts Payables (271,840) Decrease in Accrued Exp. (122,590)     (251,490) Net Cash provided by operating activities       919,730

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