Question

In this problem, we continue our accounting for Pure Water, Inc., from Chapter 10. We will assume that Pure Water, Inc., is now in its second year of operations. Assume that the comparative balance sheet for Pure Water, Inc., at July 31, 2013, and the income statement for the month ended July 31, 2013 are as follows:


Additional information follows:
Pure Water, Inc.
Income Statement
Month Ended July 31, 2013
Revenue....................$12,000
Expenses:
Cost of Goods Sold ................1,920
Depreciation Expense ............... 540
Rent Expense ................... 456
Interest Expense ................. 588
Insurance Expense ................ 288
Supplies Expense .................. 276
Salaries Expense.................4,440
Payroll Taxes Expense................ 468
Bank Service Fees................. 72
Net Income*..................$2,952
Pure Water, Inc., purchased a $12,700 truck financed with a note payable; it purchased a $43,000 building site financed with a mortgage payable; and it did not sell any fixed assets during the month.

Requirement
1. Prepare the statement of cash flows using the indirect method for the month ofJuly.


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  • CreatedApril 29, 2014
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