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Sunderland Chemical Company

E5. The condensed single-step income statement for the year ended December 31, 20x9, of Sunderland Chemical Company, a distributor of farm fertilizers and herbicides appears as follows:

Sales $13,000,000
Less; Cost of Goods Sold $7,600,000
Operating expenses (including depreciation
of $820,000) $3,800,000
Income taxes on expense $ 400,000 $11,800,000
Net Income $ 1,200,000

Selected accounts from Sunderland Chemical Company's balance sheets for 20x9 and 20x8 are as follows:

20x9 20x8
Accounts receivable $2,400,000 $1,700,000
Inventory 840,000 1,020,000
Prepaid Expense 260,000 180,000
Accunts Payable 960,000 720,000
Accrued liabilities 60,000 100,000
Income taxes payable 140,000 120,000

Present in good form a schedule of cash flows from operating activities using the indirect method.

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E5. The condensed single-step income statement for the year ended December 31, 20x9, of Sunderland Chemical Company, a distributor of farm fertilizers and herbicides appears as follows:

Sales $13,000,000
Less; Cost of Goods Sold ...

Solution Summary

This solution is comprised of a detailed explanation to present in good form a schedule of cash flows from operating activities using the indirect method.

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