Cash Flow Statement
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The following account information is available for Park Company for 2004.
Account Title Beginning of year End of Year
Accounts Receivable $26,000 $24,000
Merchandise Inventory 52,000 56,000
Prepaid Insurance 24,000 20,000
Accounts Payable (Inventory) 20,000 23,000
Salaries Payable 4,200 4,600
Other information:
1. Sales for the period was 180,000
2. Purchases of merchandise for the period were $90,000.
3. Insurance expense for the period was $42,000.
4. Other operating expenses (all cash) were $30,000.
5. Salary expense was $35,000.
Required:
a. Compute the net cash flow from operating activities.
b. Prepare the cash flow from operating activities section of the statement of cash flows.
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Solution Summary
The solution computes the net cash flow from operating activities and prepares the cash flow from operating activities section of the statement of cash flows.
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