Problem 13-3A (Direct Method) The income statement for Tremblant Limited is pres
ID: 2518183 • Letter: P
Question
Problem 13-3A (Direct Method) The income statement for Tremblant Limited is presented here: TREMBLANT LIMITED Income Statement Year Ended December 31, 2015 Service revenue Operating expenses Profit from operations Interest expense Profit before income tax Income tax expense Profit 5905,900 717,100 188,800 74,370 114,430 36,860 $77,570 Tremblant's statement of financial position contained these comparative data at December 31: 2015 2014 Accounts receivable Prepaid expenses Accounts payable Salaries payable Unearned revenue Interest payable Income tax payable $56,790 13,010 34,080 18,550 12,860 6,490 4,570 $54,540 15,130 42,170 20,910 8,510 4,840 9,370 Additional information: 1. 2. 3. Operating expenses include depreciation expense, $48,440; amortization expense, $14,880; administrative expenses, $115,000; salaries expense, $514,970; and loss on the disposal of equipment, $23,810. Unearned revenue is recelved from customers. Prepaid expenses and accounts payable relate to operating (administrative) expenses. Prepare the operating activities section of the statement of cash flows, using the direct method. (Show amounts that decrease cash flow with either a-sign e.g. -15,000 or in parenthesis e.g. (15,000).)Explanation / Answer
Solution:
Computation of cash received from customers Particulars Amount Beginning accounts receivables $56,790.00 Add: Service revenue $905,900.00 Less: Ending accounts receivables $54,540.00 Add: Ending Unearned revenue $12,860.00 Less: Beginning unearned revenue $8,510.00 Cash received from customers $912,500.00