M12-12 Computing Cash Flows from Operating Activities (Direct Method) [LO 12-6 T

Question

M12-12 Computing Cash Flows from Operating Activities (Direct Method) [LO 12-6 The independent cases are listed below that includes all items relevant to operating activities Sales revenue Cost of goods sold Depreciation expense Salaries and wages expense Net income Accounts receivable increase (decrease) Inventory increase (decrease) Accounts payable increase (decrease) Salaries and wages payable increase (decrease 1,100 (1,200 1,000 Case A Case B Case C $ 57,000 $ 47,000 $ 104,000 31,000 22,000 76,100 1.200 27,800 7,200 0,000 11,600 (7,100) 2,200 0 (2,200) 1,700 (1,000) 11,800 4,200 12,200 (1,000 3,200 1,200 Compute cash flows from operating activities using the direct method. (Amounts to be deducted should be indicated with a minus sign.) Answer is complete but not entirely correct. Case A $58,000 32,200 3,100 $93,300 Case B $43,800 23,700 13,400 $80,900 Case C Cash Collected from Customers Cash Payments to Suppliers Cash Payments for Salaries and Wages 101,800 72,900 6,200 Net Cash Provided by Operating Activities 180,900

Explanation / Answer

Particulars Case A Case B Case C

Cash collected from customers 54000 53700 95700

Cash pamentes to suppliers 38800 24700 64200

Cash payments to operating expenses 3650 15600 7300

net cash provided by operating activities 11550 13400 24200

Cash collected from customers :

Sales 53000 58000 99000

accounts receivable 1000 (4300) (3300)

totals 54000 53700 95700

Cash paid to suppliers:

Cogs 36500 27500 66500

inventory 2300 0 (3300)

Accounts payable    0 (2800) 1000

38800 24700 64200

Cash paid to operating expenses:

Operating expenses 5300 13300 8300

accrued liabilities (1650) 2300 (1000)

   3650 15600 7300.

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