Problem 12-3A The income statement of Cheyenne Corp. is presented here. Cheyenne
ID: 2586949 • Letter: P
Question
Problem 12-3A
The income statement of Cheyenne Corp. is presented here.
Cheyenne Corp.
Income Statement
For the Year Ended November 30, 2019
$7,519,500
$1,834,000
4,429,000
6,263,000
1,314,200
4,948,800
2,570,700
1,088,400
$1,482,300
Additional information:
Prepare the operating activities section of the statement of cash flows for the year ended November 30, 2019, for Cheyenne Corp., using the indirect method. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).)
Adjustments to reconcile net income to
Cheyenne Corp.
Income Statement
For the Year Ended November 30, 2019
$7,519,500
Cost of goods sold Beginning inventory$1,834,000
Purchases4,429,000
Goods available for sale6,263,000
Ending inventory1,314,200
Total cost of goods sold4,948,800
Gross profit2,570,700
Operating expenses1,088,400
Net income$1,482,300
Explanation / Answer
SOLUTION
Amount ($) Amount ($) Cash Flows from Operating Activities Net Income 1,482,300 Adjustments to reconcile net income to net Cash Provided by Operating Activities: Depreciation Expense 97,400 Decrease in Inventory 519,800 Decrease in Accrued Expenses Payable (107,000) Increase in Prepaid Expenses (177,800) Increase in Accounts Receivable (201,800) Decrease in Accounts Payable (330,600) (200,000) Net Cash Provided by Operating Activities 1,282,300