Exercise 13-4 Gutierrez Company reported net income of $199,700 for 2017. Gutier
ID: 2536585 • Letter: E
Question
Exercise 13-4
Gutierrez Company reported net income of $199,700 for 2017. Gutierrez also reported depreciation expense of $47,000 and a loss of $6,100 on disposal of the equipment. The comparative balance sheet shows a decrease in accounts receivable of $19,500 for the year, a $21,500 increase in accounts payable, and a $3,200 decrease in prepaid expenses.
Prepare the operating activities section of the statement of cash flows for 2017. Use the indirect method. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).)
Adjustments to reconcile net income to
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GUTIERREZ COMPANYPartial Statement of Cash Flows
December 31, 2017For the Year Ended December 31, 2017For the Month Ended December 31, 2017
Cash at Beginning of PeriodCash at End of PeriodCash Flows from Financing ActivitiesCash Flows from Investing ActivitiesCash Flows from Operating ActivitiesNet Cash Provided by Financing ActivitiesNet Cash Provided by Investing ActivitiesNet Cash Provided by Operating ActivitiesNet Cash Used by Financing ActivitiesNet Cash Used by Investing ActivitiesNet Cash Used by Operating ActivitiesNet Decrease in CashNet Increase in Cash
Net Income Depreciation Expense Increase in Accounts Receivable Increase in Prepaid Expenses Loss on Disposal of Equipment Increase in Accounts Payable Decrease in Accounts Payable Decrease in Accounts Receivable Decrease in Prepaid Expenses
$Adjustments to reconcile net income to
Cash at Beginning of PeriodCash at End of PeriodCash Flows from Financing ActivitiesCash Flows from Investing ActivitiesCash Flows from Operating ActivitiesNet Cash Provided by Financing ActivitiesNet Cash Provided by Investing ActivitiesNet Cash Provided by Operating ActivitiesNet Cash Used by Financing ActivitiesNet Cash Used by Investing ActivitiesNet Cash Used by Operating ActivitiesNet Decrease in CashNet Increase in Cash
Depreciation Expense Increase in Accounts Payable Loss on Disposal of Equipment Decrease in Accounts Payable Increase in Prepaid Expenses Increase in Accounts Receivable Decrease in Accounts Receivable Net Income Decrease in Prepaid Expenses
$Increase in Accounts Receivable Decrease in Accounts Receivable Depreciation Expense Increase in Prepaid Expenses Decrease in Prepaid Expenses Net Income Loss on Disposal of Equipment Increase in Accounts Payable Decrease in Accounts Payable
Loss on Disposal of Equipment Decrease in Prepaid Expenses Net Income Depreciation Expense Increase in Accounts Receivable Increase in Accounts Payable Decrease in Accounts Payable Decrease in Accounts Receivable Increase in Prepaid Expenses
Increase in Accounts Receivable Increase in Prepaid Expenses Decrease in Prepaid Expenses Loss on Disposal of Equipment Decrease in Accounts Receivable Net Income Decrease in Accounts Payable Depreciation Expense Increase in Accounts Payable
Decrease in Accounts Receivable Depreciation Expense Increase in Prepaid Expenses Loss on Disposal of Equipment Net Income Decrease in Accounts Payable Decrease in Prepaid Expenses Increase in Accounts Payable Increase in Accounts Receivable
Cash at Beginning of Period Cash at End of Period Cash Flows from Financing Activities Cash Flows from Investing Activities Cash Flows from Operating Activities Net Cash Provided by Financing Activities Net Cash Provided by Investing Activities Net Cash Provided by Operating Activities Net Cash Used by Financing Activities Net Cash Used by Investing Activities Net Cash Used by Operating Activities Net Decrease in Cash Net Increase in Cash
$Explanation / Answer
Gutierrez Company Partial Statement of Cash Flows For the Year Ended December 31, 2017 Cash flows from operating activities Net Income $ 199,700 Adjustments to reconcile net income to : Depreciation expenses $ 47,000 Loss on disposal of equipment $ 6,100 Decrease in accounts receivable $ 19,500 Decrease in prepaid expense $ 3,200 Increase in accounts payable $ 21,500 $ 97,300 Net cash flow from operating activities $ 297,000
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