ABC Corporation Income statement for the year ended December 31, Year 2 Sale revenue $500,000 Cost of
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Question:
ABC Corporation Income statement for the year ended December 31, Year 2
Sale revenue $500,000
Cost of Goods sold 300,000
Gross profit 200,000
Operating Expenses 140,000
Net Income $60,000
Additional Information for Year 2:
Increase in Accounts Receivable $10,000
Increase in Inventory 5,000
Decrease in Accounts Payable 8,000
Increase in Accrued Operating Exp 6,000
Required:
1) Prepare the Operating Activity section for the Statement of Cash Flows for Year 2 using the direct method.
2) Prepare the Operating Activity sections for the Statement of Cash Flows for Year 2 using the indirect method
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