The following information is taken from the operating section of the statement of cash flows (Direct...

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The following information is taken from the operating section of the statement of cash flows (Direct Method) of DISTAFF & SPEAR Inc.: Cash collections from customers $98,000 Cash payments to suppliers for purchases 52,000 Cash payments for operating expenses 40,000 Cash payments for current period income taxes 17,000 The following information is obtained from the income statement of DISTAFF & SPEAR Inc.: Depreciation expense $18,000 Gain on disposition of equipment 6,000 Amortization of intangibles 2,500 In addition, the following information is obtained from the balance sheets of DISTAFF & SPEAR Inc.: Increase in A/R $14,750 Increase in inventory 15,750 Decrease in A/P (related to purchases) 8,000 Decrease in accrued liability (related to operating expenses) 8,450 Increase in unearned revenue 2,000 Required: a. Prepare the income statement for the current year (12 marks) b. Prepare CFO using the INDIRECT method (8 marks) The following information is taken from the operating section of the statement of cash flows (Direct Method) of DISTAFF & SPEAR Inc.: Cash collections from customers $98,000 Cash payments to suppliers for purchases 52,000 Cash payments for operating expenses 40,000 Cash payments for current period income taxes 17,000 The following information is obtained from the income statement of DISTAFF & SPEAR Inc.: Depreciation expense $18,000 Gain on disposition of equipment 6,000 Amortization of intangibles 2,500 In addition, the following information is obtained from the balance sheets of DISTAFF & SPEAR Inc.: Increase in A/R $14,750 Increase in inventory 15,750 Decrease in A/P (related to purchases) 8,000 Decrease in accrued liability (related to operating expenses) 8,450 Increase in unearned revenue 2,000 Required: a. Prepare the income statement for the current year (12 marks) b. Prepare CFO using the INDIRECT method (8 marks)

Answer rating: 100% (QA)

a Income Statement for the current year Sales Revenue 98000 Gain on Disposition of Eq... View the full answer