The account balances for the non-cash current assets and current liabilities of Kid-game Software Inc. are...

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The account balances for the non-cash current assets and current liabilities of Kid-game Software Inc. are as follows: December 31 2020 2019 $ 99,000 Accounts receivable Inventory Prepaid expenses $122,000 86,700 51,400 112,500 45, 500 Totals $260,100 $257,000 Accounts payable Salaries payable Interest payable $ 80,000 24,000 45,500 $149,500 $ 61,500 35,000 37,500 Totals $134,000 During 2020, Kid-game Software Inc. reported depreciation expense of $52,000. All purchases and sales are on account. Profit for 2020 was $248,000. Required: 1. Prepare the operating activities section of the statement of cash flows using the indirect method. (List any deduction in cash and cash outflows as negative amounts.) KID-GAME SOFTWARE INC. Statement of Cash Flows For Year Ended December 31, 2020 Cash flows from operating activities: Profit Adjustments to reconcile profit to net cash provided by operating activities: Depreciation expense Increase in accounts receivable 52,000 Increase in prepaid expenses Decrease in merchandise inventory Increase in accounts receivable Decrease in salaries payable Increase in interest payable Net cash inflow from operating activities 52,000 The account balances for the non-cash current assets and current liabilities of Kid-game Software Inc. are as follows: December 31 2020 2019 $ 99,000 Accounts receivable Inventory Prepaid expenses $122,000 86,700 51,400 112,500 45, 500 Totals $260,100 $257,000 Accounts payable Salaries payable Interest payable $ 80,000 24,000 45,500 $149,500 $ 61,500 35,000 37,500 Totals $134,000 During 2020, Kid-game Software Inc. reported depreciation expense of $52,000. All purchases and sales are on account. Profit for 2020 was $248,000. Required: 1. Prepare the operating activities section of the statement of cash flows using the indirect method. (List any deduction in cash and cash outflows as negative amounts.) KID-GAME SOFTWARE INC. Statement of Cash Flows For Year Ended December 31, 2020 Cash flows from operating activities: Profit Adjustments to reconcile profit to net cash provided by operating activities: Depreciation expense Increase in accounts receivable 52,000 Increase in prepaid expenses Decrease in merchandise inventory Increase in accounts receivable Decrease in salaries payable Increase in interest payable Net cash inflow from operating activities 52,000

Answer rating: 100% (QA)

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