Repeat the requirements of P22-1 under the indirect method. In P22-1 Shark Company provided the following balance

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Repeat the requirements of P22-1 under the indirect method.

In P22-1

Shark Company provided the following balance sheet and income statement for the current year. Prepare the operating activities section of the cash flow statement using the direct method. Assume accrued expenses relate to selling, general and administrative expenses.

                               Shark Company

                            Income Statement

            For the Year Ended December 31

Sales    ……………………………………………..      $ 56,000

Cost of Goods Sold……………………………..      33,600

Gross Profit………………………………………     $ 22,400

Selling, General, and Administrative Expenses….     $ 11,600

Depreciation Expense…………………………….     6,000

Total Operating Expenses…………………………   $ 17,600

Income before Interest and Taxes…………………   $ 4,800

Interest Expense…………………………………..   $ (2,100)

Income before Tax…………………………………   $ 2,700

Income Tax Expense……………………………….  (1,334)

Net Income………………………………………...  $ 1,366

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Related Book For  book-img-for-question

Intermediate Accounting

ISBN: 978-0132162302

1st edition

Authors: Elizabeth A. Gordon, Jana S. Raedy, Alexander J. Sannella

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