Cash Flows from (Used for) Operating Activities

PROVIDED IMAGE FOR CLARITY

The net income reported on the income statement for the current year was $153,600. Depreciation recorded on store equipment for the year amounted to $25,300. Balances of the current asset and current liability accounts at the beginning and end of the year are as follows:

	End of Year		Beginning of Year
Cash	$61,590		$56,660
Accounts receivable (net)	44,160		41,870
Merchandise inventory	60,300		63,740
Prepaid expenses	6,770		5,380
Accounts payable (merchandise creditors)	57,710		53,600
Wages payable	31,530		35,020

a. Prepare the Cash Flows from (used for) Operating Activities section of the statement of cash flows, using the indirect method. Use the minus sign to indicate cash outflows, cash payments, decreases in cash, or any negative adjustments.

Statement of Cash Flows (partial)

Cash flows from operating activities:
Cash / Decrease in accounts receivable / Depreciation / Increase in wages payable / Net income	- Select -
Adjustments to reconcile net income to net cash flows from (used for) operating activities:
Cash / Decrease in accounts payable / Decrease in accounts receivable / Depreciation / Increase in wages payable	- Select -
Changes in current operating assets and liabilities:
Cash / Depreciation / Increase in accounts receivable / Increase in inventories / Increase in wages payable	- Select -
Cash / Decrease in accounts receivable / Decrease in merchandise inventory / Increase in inventories / Increase in prepaid expenses	- Select -
Cash / Decrease in accounts receivable / Increase in prepaid expenses / Increase in inventories / Increase in wages payable	- Select -
Cash / Decrease in accounts payable / Depreciation / Increase in accounts payable / Increase in wages payable	- Select -
Cash / Decrease in accounts receivable / Decrease in wages payable / Increase in prepaid expenses / Increase in wages payable	- Select -
Net cash flow from operating activities		fill in the blank

b. Cash flows from operating activities differ from net income because it does not use the

accrual basis / cash basis

of accounting. For example revenues are recorded on the income statement when

cash is received / they are earned

.

Cash Flows from (Used for) Operating Activities The net income reported on the income statement for the current year was $153,600. Depreciation recorded on store equipment for the year amounted to $25,300. Balances of the current asset and current liability accounts at the beginning and end of the year are as follows: a. Prepare the Cash Flows from (used for) Operating Activities section of the statement of cash flows, using the indirect method. Use the minus sign to indicate cash outflows, cash payments, decreases in cash, or any negative adjustments. Statement of Cash Flows (bartial) b. Cash flows from operating activities differ from net income because it does not use the of accounting. For example revenues are recorded on the income statement when