$6$

Required information

E$12-3($Algo$)$ Understanding the Computation of Cash Flows from Operating Activities $($Indirect Method$)[$LO $12-2]$

$[$The following information applies to the questions displayed below.$]$

Suppose your company sells services for $$475$ cash this month. Your company also pays $$325$ in salaries and wages, which includes $$165$ that was payable at the end of the previous month and $$160$ for salaries and wages of this month.

E$12-3($Algo$)$ Part $2,3$ and $4$

$2.$ Calculate the amount that should be reported as net cash flow from operating activities.

$3.$ Calculate the amount that should be reported as net income.

$4.$ Show how the indirect method would convert net income $($requirement $3)$ to net cash flow from operating activities $($requirement $2).$

Complete this question by entering your answers in the tabs below.

Required $2$

Required $3$

Required $4$

Show how the indirect method would convert net income $($requirement $3)$ to net cash flow from operating activities $($requirement $2).($Amounts to be deducted should be indicated with a minus sign.$)$

$\backslash$table$[[$Net Income,$],[$Decrease in Salaries and Wages Payable,$],[$Net Cash Flow from Operating Activities,$165]$