The net income reported on the income statement for the current year was $297,26
ID: 2494078 • Letter: T
Question
The net income reported on the income statement for the current year was $297,269. Depreciation recorded on fixed assets and amortization of patents for the year were $37,190 and $11,737, respectively. Balances of current asset and current liability accounts at the end and at the beginning of the year are as follows:
What is the amount of cash flows from operating activities reported on the statement of cash flows prepared by the indirect method?
Select the correct answer.
If $1,108,000 of 9% bonds are issued at 102 1/2, what is the amount of cash received from the sale?
Select the correct answer.
Treasury stock that had been purchased for $3,658 last month was reissued this month for $5,152. What would the journal entry to record the reissuance include?
Select the correct answer.
Land costing $71,050 was sold for $95,185 cash. The loss on the sale was reported on the income statement as other expense. On the statement of cash flows, what amount should be reported as an investing activity from the sale of land?
Select the correct answer.
Loster Company reported a net loss of $14,039 for the year ended December 31, 2010. During the year, accounts receivable decreased by $4,319, merchandise inventory increased by $7,370, accounts payable increased by $13,496, and depreciation expense of $6,749 was recorded. What was the net cash used for or provided by operating activities during the year 2010?
Select the correct answer.
End Beginning Cash $36,566 $50,350 Accounts receivable $108,615 $125,082 Inventories $95,581 $109,223 Prepaid expenses $8,043 $3,932 Accounts payable (merchandise creditors) $67,698 $50,727Explanation / Answer
1.
The net income reported on the income statement for the current year = $297,269
Add: Non Cash Expenditure
Depreciation recorded on fixed assets $37,190
Amortization of patents $11,737
Add: Decrease in Inventories $13,642
Add: Increase in Accounts payable $16,971
Net Cash Flow from Operating Activity = $389,165 (Option A)
2.
If $1,108,000 of 9% bonds are issued at 102 1/2, amount of Cash received = $1,108,000 X 1.025 = $1,135,700 (Option B)
3.
Entry on Re-issue of Treasury Stock:
Cash Dr. 5,152
To Treasury stock Cr.3,658
To Excess of Par/Common Stock – treasury stock Cr.1,494
Answer: Credit to Excess of Par/Common for $1,494
4.
Land costing $71,050 was sold for $95,185 cash
Since, the amount of Cash received is $95,185, the same should be reported as an Investing activity from the sale of land
Answer is Option D
5.
Net loss = ($14,039)
Add: Depreciation expense = $6,749
Add: Accounts receivable decreased = $4,319
Less: Merchandise inventory increased = ($7,370)
Add: Accounts payable increased by = $13,496
Therefore Provided Net Cash for $3,155
Answer is Option B
Add: Decrease in Accounts receivable $16,467Add: Decrease in Inventories $13,642
Less: Increase in Prepaid expenses ($4,111)Add: Increase in Accounts payable $16,971
Net Cash Flow from Operating Activity = $389,165 (Option A)
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