The income statement of Martinez Company is shown below MARTINEZ COMPANY INCOME
ID: 2549288 • Letter: T
Question
The income statement of Martinez Company is shown below MARTINEZ COMPANY INCOME STATEMENT FOR THE YEAR ENDED DECEMBER 31, 2017 Sales revenue $7,030,000 Cost of goods sold Beginning inventory Purchases Goods available for sale Ending inventory Cost of goods sold $1,950,000 4,600,000 6,550,000 1,680,000 4,870,000 2,160,000 Gross proft Operating expenses Selling expenises Administrative expenses 500,000 640,000 1,140,000 $1,020,000 Net income Additional information: 1. Accounts receivable decreased $330,000 during the year 2. Prepaid expenses increased $160,000 during the year yable to suppliers of merchandise decreased $270,000 during the year 3. Accounts pa 4. Accrued expenses payable decreased $120,000 during the year S. Administrative expenses include depre ciation expense of $60,000. Prepare the operating activities section of the statement of cash nows for the year ended December 31, 2017, for Martinez amounts that decrease cash flow with either a sign e.g.-is,000 or in parenthesis e.g. Company, using the indirect method. ,Explanation / Answer
Cash Flow from Operating Activities
Net Profit before tax 1020000 Add : Non Cash Expenses- Depreciation 60000 Operating Profit before Working Capital Changes 1080000 Add : (Increase) / Decrease Changes in Accounts Recievables 330000 Add : (Increase) / Decrease Changes in Inventory 270000 Less : (Increase) / Decrease Changes in Prepaid Expenses -160000 Less : Increase / (Decrease) Changes in Accounts Payables -270000 Add : Increase / (Decrease) Changes in Accrued Expenses -120000 Cash Flow from Operating Activities 1130000Related Questions
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