Bloom Corporation had the following 2014 income statement. $203,580 107,500 96,0
ID: 2454774 • Letter: B
Question
Bloom Corporation had the following 2014 income statement.
$203,580
107,500
96,080
50,470
$45,610
The following accounts increased during 2014: Accounts Receivable $13,040; Inventory $10,720; Accounts Payable $13,640. Prepare the cash flows from operating activities section of Bloom’s 2014 statement of cash flows using the direct method.
Bloom Corporation
Statement of Cash Flows-Direct Method (Partial)
For the Year 2014
Cash Flows from Operating Activities
Cash Received from Customers
Cash Payment to Suppliers
Cash Payment for Operating Expenses
Net Cash Provided by Operating Activities
Open Show Work
Sales revenue$203,580
Cost of goods sold107,500
Gross profit96,080
Operating expenses (includes depreciation of $23,740)50,470
Net income$45,610
Explanation / Answer
**Purchase =COGS +Increase in inventory
= 107500+10720 =$ 118220
Cash Flows from Operating Activities Cash Received from Customers (sales 203580- increase in receivable 13040) 190540 Cash Payment to Suppliers (118220 purchase- 13640 payable) (104580) Cash Payment for Operating Expenses [50470-23740] (26730) Net Cash Provided by Operating Activities 59230