The accounting records of Pepperell Pharmaceuticals, Inc., reveal the following: (Click the icon to view the...
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The accounting records of Pepperell Pharmaceuticals, Inc., reveal the following: (Click the icon to view the accounting records.) Requirement Compute cash flows from operating activities by the direct method. Also evaluate Pepperellisperating cash flow. Give the reason for your evaluation. Start by completing the cash flows from operating activities. (Use parentheses or a minus sign for numbers to be subtracted, for payments, and for a net decrease in cash.) Cash flows from operating activities: Receipts: Total cash receipts Payments: C Total cash payments Net cash provided by (used for) operating activities Accounting records Payment of salaries and wages Depreciation expense Increase in current liabilities Decrease in current assets other than cash Payment of dividends Collection of accounts receivable Net income $ 33,000 Payment of income tax 25,000 Collection of dividend revenue 20,000 Payment of interest Cash sales 24,000 Gain on sale of land 13,000 Acquisition of land with cash Payment of accounts payable 80,000 $ 26,000 24,000 11,000 14,000 34,000 8,000 32,000 50,000 The accounting records of Pepperell Pharmaceuticals, Inc., reveal the following: (Click the icon to view the accounting records.) Requirement Compute cash flows from operating activities by the direct method. Also evaluate Pepperellisperating cash flow. Give the reason for your evaluation. Start by completing the cash flows from operating activities. (Use parentheses or a minus sign for numbers to be subtracted, for payments, and for a net decrease in cash.) Cash flows from operating activities: Receipts: Total cash receipts Payments: C Total cash payments Net cash provided by (used for) operating activities Accounting records Payment of salaries and wages Depreciation expense Increase in current liabilities Decrease in current assets other than cash Payment of dividends Collection of accounts receivable Net income $ 33,000 Payment of income tax 25,000 Collection of dividend revenue 20,000 Payment of interest Cash sales 24,000 Gain on sale of land 13,000 Acquisition of land with cash Payment of accounts payable 80,000 $ 26,000 24,000 11,000 14,000 34,000 8,000 32,000 50,000
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To compute cash flows from operating activities using the direct method we need to analyze the provi... View the full answer
Related Book For
Financial Accounting
ISBN: 978-0134725987
12th edition
Authors: C. William Thomas, Wendy M. Tietz, Walter T. Harrison Jr.
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