Chapter_23_Solutions

Chapter_23_Solutions - Chapter 1 EXERCISE 23-1 (a) (b) (c)...

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Chapter 1 EXERCISE 23-1 (a) Operating—add to net income. (b) Financing activity. (c) Investing activity. (d) Operating—add to net income. (e) Significant noncash investing and financing activity. (f) Financing activity. (g) Operating—add to net income. (h) Financing activity. (i) Significant noncash investing and financing activity. (j) Financing activity. (k) Operating—deduct from net income. (l) Investing activity. EXERCISE 23-5 NORMAN COMPANY Partial Statement of Cash Flows For the Year Ended December 31, 2010 Cash flows from operating activities Cash receipts from customers. ........................... $862,000 (a) Cash payments. .................................................. For operating expenses. ............................ $609,000 (b) For income taxes. ...................................... 44,500 (c) 653,500 Net cash provided by operating activities. .......................................................... $208,500 (a) Computation of cash receipts from customers : Revenue from fees. ................................................................. $840,000 Add: Decrease in accounts receivable Ad ($59,000 – $37,000). .................................................. 22,000 Cash receipts from customers. ............................................... $862,000 (b) Computation of cash payments : Operating expenses per income statement. ........................... $624,000 Deduct: Increase in accounts payable
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Deduct ($46,000 – $31,000). .......................................... 15,000 Cash payments for operating expenses. ................................ $609,000 (c) Income tax expense per income statement. ........................... $ 40,000 Add: Decrease in income taxes payable Add ($8,500 – $4,000). ..................................................... 4,500 Cash payments for income taxes. .......................................... $ 44,500 EXERCISE 23-6 NORMAN COMPANY Partial Statement of Cash Flows For the Year Ended December 31, 2010 Cash flows from operating activities Net income. .................................................................................... $90,000 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation expense. ............................................................. $60,000 Loss on sale of equipment. ...................................................... 26,000 Decrease in accounts receivable. ............................................ 22,000 Increase in accounts payable. ................................................. 15,000 Decrease in income taxes payable. ......................................... (4,500 ) 118,500 Net cash provided by operating activities. ..................................... $208,500 PROBLEM 23-2 HINCKLEY CORPORATION Statement of Cash Flows For the Year Ended December 31, 2010 Cash flows from operating activities Net income. ........................................................................... $14,750 (a) Adjustments to reconcile net income to net cash provided by operating
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This note was uploaded on 03/01/2010 for the course ACCT 30801E taught by Professor Darland during the Spring '10 term at Buena Vista.

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Chapter_23_Solutions - Chapter 1 EXERCISE 23-1 (a) (b) (c)...

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