Exam 29: The Direct Method of Determining the Net Cash Provided by Operating Activities

Van Aalst Company's comparative balance sheet and income statement for last year appear below: The company declared and paid $77,000 in cash dividends during the year. It did not sell or retire any property, plant, and equipment during the year. The company uses the direct method to determine the net cash provided by operating activities. -On the statement of cash flows,the selling and administrative expense adjusted to a cash basis would be:

Olaf Corporation prepares its statement of cash flows using the direct method.The following items were listed on Olaf's income statement.Which of these items would also be listed in the operating activities section of Olaf's statement of cash flows?

Last year Lawsby Company reported sales of $120,000 on its income statement.During the year,accounts receivable increased by $10,000 and accounts payable increased by $15,000.The company uses the direct method to determine the net cash provided by operating activities on the statement of cash flows.The sales revenue adjusted to a cash basis for the year would be:

Sawyer Corporation's balance sheet and income statement appear below: Cash dividends were $7.The company sold equipment for $13 that was originally purchased for $3 and that had accumulated depreciation of $2. Required: Using the direct method,determine the net cash provided by operating activities.

Milton Corporation's balance sheet and income statement appear below: Cash dividends were $2.The company did not dispose of any property,plant,and equipment during the year. Required: Prepare the operating activities section of the statement of cash flows using the direct method.

The changes in each balance sheet account for Bryan Company during the year just completed are as follows: Bryan Company's income statement for the year just ended shows the following: The company did not dispose of any property,plant,and equipment,buy any long-term investments,issue any bonds payable,or repurchase any of its own common stock during the year.Bryan Company uses the direct method to construct its statement of cash flows. Required: a.Determine the sales adjusted to the cash basis. b.Determine the cost of goods sold adjusted to the cash basis. c.Determine the selling and administrative expenses adjusted to a cash basis. d.Determine the net cash provided (used)by operating activities. e.Determine the net cash provided (used)by investing activities. f.Determine the net cash provided (used)by financing activities.

Fluck Corporation's balance sheet and income statement appear below: The company sold equipment for $12 that was originally purchased for $5 and that had accumulated depreciation of $3. The company paid a cash dividend and it did not issue any bonds payable or repurchase any of its own common stock. -The net cash provided by (used in)operating activities for the year was:

Fluck Corporation's balance sheet and income statement appear below: The company sold equipment for $12 that was originally purchased for $5 and that had accumulated depreciation of $3. The company paid a cash dividend and it did not issue any bonds payable or repurchase any of its own common stock. -The net cash provided by (used in)financing activities for the year was:

If accounts receivable increase during a period,then the amount of cash collected from customers will be greater than the amount of sales reported on the income statement for the period.

Kelln Corporation's most recent comparative balance sheet and income statement appear below: The company paid a cash dividend and it did not dispose of any property, plant, and equipment. The company did not issue any bonds payable or repurchase any of its own common stock. The following questions pertain to the company's statement of cash flows. -The net cash provided by (used in)financing activities for the year was:

Van Aalst Company's comparative balance sheet and income statement for last year appear below: The company declared and paid $77,000 in cash dividends during the year. It did not sell or retire any property, plant, and equipment during the year. The company uses the direct method to determine the net cash provided by operating activities. -On the statement of cash flows,the sales revenue adjusted to a cash basis would be:

Van Aalst Company's comparative balance sheet and income statement for last year appear below: The company declared and paid $77,000 in cash dividends during the year. It did not sell or retire any property, plant, and equipment during the year. The company uses the direct method to determine the net cash provided by operating activities. -On the statement of cash flows,the cost of goods sold adjusted to a cash basis would be:

The most recent balance sheet and income statement of Marroquin Corporation appear below: The company paid a cash dividend and it did not dispose of any property, plant, and equipment. The company did not issue any bonds payable or repurchase any of its own common stock. The following questions pertain to the company's statement of cash flows. -The net cash provided by (used in)investing activities for the year was:

Cavett Company's comparative balance sheet and income statement for last year appear below: The following additional information is available for the year: * During the year,the company sold long-term investments with a cost of $38,000 when purchased for $33,000 in cash. * All sales were on credit. * The company paid a cash dividend of $25,000. * The company did not dispose of any property,plant,and equipment,issue any bonds payable,or repurchase any of its own common stock during the year. Required: a.Using the direct method,determine the net cash provided by operating activities for the year. b.Using the indirect method,determine the net cash provided by operating activities for the year. c.Using the net cash provided by operating activities figure from either part a or b,prepare a statement of cash flows for the year.

Under the direct method of determining the net cash provided by operating activities on the statement of cash flows,an increase in income taxes payable would be subtracted from income tax expense to convert income tax expense to a cash basis.

Fluck Corporation's balance sheet and income statement appear below: The company sold equipment for $12 that was originally purchased for $5 and that had accumulated depreciation of $3. The company paid a cash dividend and it did not issue any bonds payable or repurchase any of its own common stock. -The net cash provided by (used in)investing activities for the year was:

Kelln Corporation's most recent comparative balance sheet and income statement appear below: The company paid a cash dividend and it did not dispose of any property, plant, and equipment. The company did not issue any bonds payable or repurchase any of its own common stock. The following questions pertain to the company's statement of cash flows. -The net cash provided by (used in)investing activities for the year was:

The changes in Tener Company's balance sheet account balances for last year appear below: The company's income statement for the year appears below: The company declared and paid $67,000 in cash dividends during the year. It did not dispose of any property, plant, and equipment during the year. The company uses the direct method to determine the net cash provided by operating activities. -On the statement of cash flows,the cost of goods sold adjusted to a cash basis would be:

Carlton Company reported on its income statement sales for the year just ended of $435,000.Sales during the year adjusted to the cash basis on its statement of cash flows constructed using the direct method were $460,000.Carlton Company recorded the following account balances: Based on this information,the balance in Accounts Receivable at the beginning of the year was:

Sales reported on the income statement totaled $850,000.The beginning balance in accounts receivable was $90,000.The ending balance in accounts receivable was $160,000.Under the direct method of determining the net cash provided by operating activities on the statement of cash flows,sales adjusted to a cash basis are: