Direct method please Instructions Balances of the current asset and current liab

Question

Direct method please
Instructions Balances of the current asset and current liability accounts at the end and beginning of the year are as follows: End Cash Accounts receivable (net) Inventories Accounts payable (merchandise creditors)43,000 Salaries payable Sales (on account) Cost of merchandise sold Operating expenses other than depreciation67,000 Beginning $62,000 $73,000 75,000 60,000 54,000 47,000 37,000 3,800 2,800 210,000 70,000 Use the direct method to prepare the cash flows from operating activities section of a statement of cash flows. Refer to the Amount Descriptions list provided for the exact

Explanation / Answer

Cash Flow from Operating Activities :-

Particulars Amounts ($) Sales 210000 Less : Cost of Merchandise Sold (70000) Less : Operating Expenses (67000) Net Operating Income($210000 - $70000 - $67000) 73000 Less : Increase in Accounts Recevable (15000) Less : Increase in Inventory (7000) Add : Increase in Accounts Payable 6000 Less : Decrease in Salaries Payable (1000) Cash Flow from Operating Activities 56000

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