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Bentley: Prepare cash flows from the operating activities section, indirect method

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Bentley Company reported net income of $320,000 for the current year. Depreciation recorded on buildings and equipment amounted to $75,000 for the year. Balances of the current asset and current liability accounts at the beginning and end of the year are as follows:

End of the Year Beginning of the Year
Cash 22000 15000
Accounts Receivable 17000 32000
Inventories 55000 65000
Prepaid expenses 7500 5000
Accounts Payable 14000 18000
Income taxes payable 600 1200

Prepare the cash flows from the operating activities section of the statement of cash flows using the indirect method.

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Prepare the cash flows from the operating activities section of the statement of cash flows using the indirect method.

Bentley Company reported net income of ...

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This solution is comprised of a detailed explanation to prepare the cash flows from the operating activities section of the statement of cash flows using the indirect method.

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Bentley Company reported net income of $320,000 for the current year. Depreciation recorded on buildings and equipment amounted to $75,000 for the year. Balances of the current asset and current liability accounts at the beginning and end of the year are as follows:

End of Year
Beginning of Year

Cash
$22,000
$15,000

Accounts receivable
17,000
32,000

Inventories
55,000
65,000

Prepaid expenses
7,500
5,000

Accounts payable
14,000
18,000

Income taxes payable
600
1,200

Instructions
Prepare the cash flows from the operating activities section of the statement of cash flows using the indirect method

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