The following Income Statement and Operating Cash Flow information pertain to Re
ID: 2536276 • Letter: T
Question
The following Income Statement and Operating Cash Flow information pertain to Receivership Inc.’s operations for the year ended December 31, 2018.
Required:
Prepare the net cash flow from operating activities section of the cash flow statement using the direct method.
Income statement for the year ended December 31, 2018 Revenues 1,328 Cost of goods sold 587 Rent expenses 152 Wages expenses 136 Insurance expenses 53 Other SG&A (includes depreciation expenses) 198 Interest expenses 30 Gain on sale of asset (5 ) 1,151 Income before tax 177 Tax 62 Net income 115Explanation / Answer
Solution:
Computation of cash received from customers Particulars Amount Revenues $1,328.00 Add: Decrease in Account Receivables $26.00 Less: Decrease in Advances from customers $3.00 Cash received from customers $1,351.00