Portions of the financial statements for Horizon Telecom are provided below. Pre
ID: 2587703 • Letter: P
Question
Portions of the financial statements for Horizon Telecom are provided below.
Prepare the operating activities section of the statement of cash flows for Horizon Telecom using the indirect method. (Amounts to be deducted and negative values should be indicated by minus sign.)
HORIZON TELECOM Income Statement For the Year Ended December 31, 2018 $613,000 Revenues Expenses: Cost of goods sold Operating expenses Depreciation expense Income tax expense $360,000 116,000 33,000 52,000 Total expenses 561,000 Net Income $52,000 ActExplanation / Answer
Answer:-
HORIZON Telecom Statement of Cash Flow (Using Indirect Method) For the year ended December 31,2018 Particulars Amount $ Net Income 52000 Adjustments to reconcile net income to net cash provided by opreating activities Adjustment for non cash effects Depreciation 33000 Change in opreating assets & liabilities Increase in Accounts Receiviable -5800 Increase in Inventory -12100 Decrease in Prepaid rent 10200 Increase in opreating expenses payable 6200 Decrease in Accounts payable -7100 Increase in Income tax payble 21000 Net cash flow from opreating activities 97400