For the just completed year, Hanna Company had net Income of $127,000. Balances in the company's...

  

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For the just completed year, Hanna Company had net Income of $127,000. Balances in the company's current asset and current liability accounts at the beginning and end of the year were as follows: Current assets: Cash and cash equivalents Accounts receivable Inventory Prepaid expenses Current liabilities: Accounts payable Accrued liabilities Income taxes payable December 31 End of Year $ 56,000 $ 160,000 432,000 $ 11,800 Beginning of Year $ 79,000 $196,000 346,000 $ 13,900 $360,000 $390,000 $8,000 $12,500 $ 33,000 $20,000 Sales Cost of goods sold Gross margin Selling and administrative expenses Income before taxes Income taxes Net income The Accumulated Depreciation account had total credits of $58,000 during the year. Hanna Company did not record any gains or losses during the year. The company's income statement for the year appears below: $1,070,000 585,000 485,000 316,000 169,000 42,000 $ 127,000 Required: Using the direct method, convert the company's income statement to a cash basis. (Adjustment amounts that are to be deducted should be indicated with a minus sign.) Hanna Company Direct Method of Determining the Net Cash Flows from Operating Activities Net Income Adjustments to a cash basis: Depreciation Decrease in accounts receivable Adjustments to a cash basis: Selling and administrative expenses Adjustments to a cash basis: Income taxes Adjustments to a cash basis: Decrease in accrued liabilities Increase in income taxes payable Net cash provided by operating activities $ $ 0 0 0 0 0 For the just completed year, Hanna Company had net Income of $127,000. Balances in the company's current asset and current liability accounts at the beginning and end of the year were as follows: Current assets: Cash and cash equivalents Accounts receivable Inventory Prepaid expenses Current liabilities: Accounts payable Accrued liabilities Income taxes payable December 31 End of Year $ 56,000 $ 160,000 432,000 $ 11,800 Beginning of Year $ 79,000 $196,000 346,000 $ 13,900 $360,000 $390,000 $8,000 $12,500 $ 33,000 $20,000 Sales Cost of goods sold Gross margin Selling and administrative expenses Income before taxes Income taxes Net income The Accumulated Depreciation account had total credits of $58,000 during the year. Hanna Company did not record any gains or losses during the year. The company's income statement for the year appears below: $1,070,000 585,000 485,000 316,000 169,000 42,000 $ 127,000 Required: Using the direct method, convert the company's income statement to a cash basis. (Adjustment amounts that are to be deducted should be indicated with a minus sign.) Hanna Company Direct Method of Determining the Net Cash Flows from Operating Activities Net Income Adjustments to a cash basis: Depreciation Decrease in accounts receivable Adjustments to a cash basis: Selling and administrative expenses Adjustments to a cash basis: Income taxes Adjustments to a cash basis: Decrease in accrued liabilities Increase in income taxes payable Net cash provided by operating activities $ $ 0 0 0 0 0

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