Additional information

• Equipment that cost $8,000 was sold for the carrying amount of $3,750
• Dividends declared and paid were $10,000.

Required

Prepare the operating activities section for the statement of cash flows using the direct method.

Transcribed Image Text:

Palm Tree Limited has the following financial statements: Income Statement For the Year Ended December 31, 2022 Net sales Cost of goods sold Gross profit Operating expenses Income from operations Interest expense Income before income taxes Income Tax Net Income $165,000 97,500 67,500 27,500 40,000 3,500 36,500 11,000 $ 25,500 Palm Tree Limited has the following financial statements: Income Statement For the Year Ended December 31, 2022 Net sales Cost of goods sold Gross profit Operating expenses Income from operations Interest expense Income before income taxes Income Tax Net Income $165,000 97,500 67,500 27,500 40,000 3,500 36,500 11,000 $ 25,500

Answer rating: 100% (QA)

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