chapter23excel

chapter23excel - ASSUMED ACTIVITY Opening balance Sales on...

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ASSUMED ACTIVITY: Opening balance 1,000,000 Sales on credit 10,000,000 Cash sales 100,000 Collections 9,500,000 Accounts Receivable NET INCOME Opening balance 1,000,000 Sales on credit 10,000,000 (10,000,000) Cash sales (100,000) Collections (9,500,000) Ending 1,500,000 (10,100,000) Change in A/R 500,000 HOW THE STATEMENT OF CASH FLOWS WOULD APPEAR: Net income 10,100,000 Adjustments to reconcile net income to cash provided by operations: Increase in accounts receivable (500,000) Cash provided by operations 9,600,000 LETS CHECK IT- FROM ABOVE We collected 9,500,000 We made cash sales 100,000 9,600,000
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Fixed asset Beginning of year 100,000 Sold (100,000) Ending - Accumulated depreciation Beginning of year 70,000 Cy Depreciation expense 5,000 Sold (75,000) Ending - How much did fixed assets change by? 30,000 In the operating section we pull out the In the statement of cash flow non-cash depreciation expense: change of Depreciation expense 5,000 Operating section adjustments: Gain on sale 75,000 Depreciation back-out Gain back-out Sell the thing for $100k: Proceeds from sale Purchase price 100,000 WOW- PRESENTING IT THIS WA NBV at sale (25,000) CHANGE! 75,000 In the investing section we show: Cash proceeds from sale of fixed assets 100,000
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s we have accounted for the f $30,000: 5,000 (75,000) 100,000 AY REFLECTS THE 30,000
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Direct OPERATING SECTION Net income
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This note was uploaded on 08/06/2008 for the course ECON 136C taught by Professor Anderson during the Summer '08 term at UCSB.

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chapter23excel - ASSUMED ACTIVITY Opening balance Sales on...

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