The Operating Activities Section-Statement of Cash Flows
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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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Solution Summary
This solution illustrates how to prepare the operating activities section of a statement of cash flows.
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Net income $320,000
Depreciation expense 75,000
Decrease in accounts receivable ...
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