Use the following income statement and information about changes in non-cash cur
ID: 2336840 • Letter: U
Question
Use the following income statement and information about changes in non-cash current assets and current liabilities to present the cash flows from operating activities using the indirect method. (Indicate any loss, cash outflow or deduction in cash with a minus sign. Kelly Gold Inc. Income Statement For Year Ended May 31, 2017 Sales Cost of goods sold $2,950 1,490 $1,460 Gross profit Operating expenses: S 235 1,240 Depreciation expense Other expenses Total operating expenses Loss on sale of long-term investment 1,475 100 Profit (loss) from operations Income tax expense S (115) Profit (loss) S (115)Explanation / Answer
Cash Flows from Operating Activties
Net Profit Before Tax and Extra Ordinary Item ($115)
Adjustment for :
Depreciation Expenses $235
Loss on sale of Long term investment $100
Operating Profit before working capital $220
changes:
Adjustment for CA and CL
Increase in Accounts Payable $80
Decrease in Accrued Liab ($45)
Decrease in Accounts Receivable $345
Increase in Inventory ($134)
Increase in Prepaid Insurance ($16)
Cash Generated from Operations $230
Cash before Extraordinary Items $450
Extra Ordinary Items $0
Net Cash From used in operations $450