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

Cridman Company's selling and administrative expenses for last year totaled $180,000.During the year the company's prepaid expense account balance decreased by $5,000 and accrued liabilities increased by $8,000.Depreciation for the year was $12,000.Based on this information,selling and administrative expenses adjusted to a cash basis under the direct method on the statement of cash flows would be:

Last year, Nye Company reported on its income statement sales of $475,000 and cost of goods sold of $240,000. During the year, the balance in accounts receivable increased $40,000, the balance in accounts payable decreased $25,000, and the balance in inventory increased $10,000. The company uses the direct method to determine the net cash provided by operating activities on its statement of cash flows. -Under the direct method,sales 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)operating activities for the year was:

Alkine Company's comparative balance sheet appears below: Alkine reported the following net income for the year: Dividends were declared and paid during the year. A gain of $8,000 was recorded on the sale of the long-term investments. The company did not purchase any long-term investments or dispose of any property, plant, and equipment during the year. It also did not issue any bonds payable or repurchase any of its own common stock. -The net cash provided (used)by financing activities 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)financing activities for the year was:

Last year Cumber Company reported a cost of goods sold of $70,000.Inventories decreased by $12,000 during the year,and accounts payable increased by $8,000.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:

Last year, Nye Company reported on its income statement sales of $475,000 and cost of goods sold of $240,000. During the year, the balance in accounts receivable increased $40,000, the balance in accounts payable decreased $25,000, and the balance in inventory increased $10,000. The company uses the direct method to determine the net cash provided by operating activities on its statement of cash flows. -Under the direct method,cost of goods sold adjusted to a cash basis would be:

Alkine Company's comparative balance sheet appears below: Alkine reported the following net income for the year: Dividends were declared and paid during the year. A gain of $8,000 was recorded on the sale of the long-term investments. The company did not purchase any long-term investments or dispose of any property, plant, and equipment during the year. It also did not issue any bonds payable or repurchase any of its own common stock. -The net cash provided (used)by investing activities would be: