29 Jun Question The income statement of Rodriquez Company is shown below.
QuQuestion
The income statement of Rodriquez Company is shown below.estion
The income statement of Rodriquez Company is shown below.
RODRIQUEZ COMPANYINCOME STATEMENTFOR THE YEAR ENDED DECEMBER 31, 2012
Sales$6,884,420
Cost of goods soldBeginning inventory$1,897,410
Purchases4,478,260
Goods available for sale6,375,670
Ending inventory1,601,260
Cost of goods sold4,774,410
Gross profit2,110,010
Operating expensesSelling expenses448,740
Administrative expenses695,660
1,144,400
Net income$965,610
Additional information:
1. Accounts receivable decreased $317,330 during the year.2. Prepaid expenses increased $160,690 during the year.3. Accounts payable to suppliers of merchandise decreased $281,450 during the year.4. Accrued expenses payable decreased $127,540 during the year.5. Administrative expenses include depreciation expense of $56,710.
Prepare the operating activities section of the statement of cash flows using the direct method.
Situation A:Chenowith Co. reports revenues of $191,900 and operating expenses of $111,340 in its first year of operations, 2012. Accounts receivable and accounts payable at year-end were $82,360 and $37,200, respectively. Assume that the accounts payable related to operating expenses. Ignore income taxes.
Using the direct method, compute net cash provided (used) by operating activities. (If an amount reduces the account balance then enter with negative sign.)
Net cashprovidedusedby operating activities$
Situation B:The income statement for Edgebrook Company shows cost of goods sold $310,820 and operating expenses (exclusive of depreciation) $227,710. The comparative balance sheet for the year shows that inventory increased $23,390, prepaid expenses decreased $8,240, accounts payable (related to merchandise) decreased $18,620, and accrued expenses payable increased $11,740.
Compute (a) cash payments to suppliers and (b) cash payments for operating expenses.
(a) Cash payments to suppliers$
(b) Cash payments for operating expenses$
Condensed financial data of Fairchild Company for 2012 and 2011 are presented below.
FAIRCHILD COMPANYCOMPARATIVE BALANCE SHEETAS OF DECEMBER 31, 2012 AND 2011
2012
2011
Cash$1,807
$1,095
Receivables1,750
1,294
Inventory1,593
1,902
Plant assets1,897
1,703
Accumulated depreciation(1,203
)
(1,169
)
Long-term investments (held-to-maturity)1,301
1,465
$7,145
$6,290
Accounts payable$1,216
$791
Accrued liabilities200
230
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