value: 15.00 points The two independent cases are listed below: Case A Case B Ye

Question

value: 15.00 points The two independent cases are listed below: Case A Case B Year 2 Year 1 Year 2Year 1 $11,700 $12,500 $21,700 $21,500 Sales Revenue Cost of Goods Sold Gross Profit Depreciation Expense Salaries and Wages Expense Net Income Accounts Receivable Inventory Accounts Payable Salaries and Wages Payable 6,6309,200 12,630 13,460 5,0703,300 9,070 8,040 1,100 1,100 1,850 1,850 1,800 1,300 5,700 5,700 900 1,520 2,170 335 785 870 470 570 735 1,035 1,270 820 765 870 235 490 635 870 955 320 Show the operating activities section of the statement of cash flows for year 2 using the indirect method (Amounts to be deducted should be indicated with a minus sign.)

Explanation / Answer

SOLUTION

Cash flow statements-

Case A Case B Net Income 2,170 1,520 Adjustments to reconcile net incometo net cash providedby Operating activies Depreciation Expense 1,100 1,850 Changes in Assets- Decrease / (Increase) in accounts receivable (470-335), (820-635) 135 (185) Decrease / (Increase) in inventory (785-570), (870-765) (215) 105 Increase / (Decrease) in Accounts payable (870-735), (955-870) 135 (85) Increase / (Decrease) in Salaries and wages payable (1,270-1,035), (320-235) (235) (85) Cash Flows from Operating Activities 3,090 3,120

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