The following balance sheet and income statement data were taken from the records of Harbaugh Auto Supply
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Prepare the operating section of the statement of cash flows, and present it under both the direct and indirect methods.
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2017 2018 BALANCE SHEET $ 10,100 $ 8,400 Cash 13,900 Accounts receivable 14,400 Inventory 21,600 18,700 Interest receivable 1,200 1,500 Prepaid rent 2,600 1,400 $ 49,900 $ 43,900 Total current assets 32,100 Investments 35,400 Equipment (net) 98,000 91,700 $183,300 $167,700 Total $ 18,700 $ 21,300 Accounts payable Salaries and wages payable 9,800 11,200 Interest payable 2,300 1,700 Dividends payable 1,700 1,200 Income taxes payable 3,100 4,300 Unearned revenue 12,300 15,100 $ 47,900 $ 54,800 Total current liabilities Notes payable 68,300 62,800 Common stock 42,000 42,000 Retained earnings 25,100 8,100 $183,300 $167,700 Total INCOME STATEMENT Sales revenues $ 47,500 Service revenue 35,200 Interest revenue 9,300 Cost of goods sold (21,200) Salaries and wages expense (17,600) Rent expense (15,300) Interest expense (6,200) Depreciation expense (11,500) Add: Gain on disposal of plant assets 13,200 Net income before taxes $ 33,400 Income tax expense 9,100 Net income $ 24,300
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Harbaugh Auto Supply Operating Section Statement of Cash Flows Direct Method For the Year Ended December 31 2018 Cash from operating activities Cash r...View the full answer
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Unearned revenue is money received by an individual or company for a service or product that has yet to be provided or delivered. It can be thought of as a \"prepayment\" for goods or services that a person or company is expected to supply to the purchaser at a later date. As a result of this prepayment, the seller has a liability equal to the revenue earned until the good or service is delivered. This liability is noted under current liabilities, as it is expected to be settled within a year.
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