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Chapter 13 statement of cash flows h Free cash flow = \$30,000 (\$200,000 – \$105,000 – \$65,000) Operating expenses. ........................................ €160,000 Less: Non-cash depreciation expense. ............ (25,000) Add: Increase in prepaid expenses. ................. 5,000 Add: Decrease in accrued liabilities. ................ 6,700 Cash payments for operating expenses. .......... 146,700 (a) Cash receipts from customers Sales + Decrease in Accounts Receivable \$2,200,000 + \$39,000 = \$2,239,000 (b) Cash payments to suppliers First calculate the amount of purchases: Beginning inventory \$ 210,000 Add: Purchases ? ? Less: Ending inventory 310,000 Cost of goods sold \$1,500,000 \$210,000 + Purchases – \$310,000 = \$1,500,000 Purchases = \$1,600,000 Amount of cash payments to suppliers = Purchases + Decrease in accounts payable =\$1,600,000 + \$25,000 =\$1,625,000

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Unformatted text preview: r& 1. B 6. D 2. E 7. F 3. A 8. C 4. A 9. G 5. E 10. B r& Transaction Where Reported Cash Inflow, Outflow, or No Effect? (a) Recorded depreciation expense on the plant assets. O No cash flow effect (b) Recorded and paid interest expense. O Cash outflow (c) Recorded cash proceeds from a sale of plant assets. I Cash inflow (d) Acquired land by issuing ordinary shares. NC No cash flow effect (e) Paid a cash dividend to preference shareholders. F Cash outflow (f) Distributed a share dividend to ordinary shareholders. NC No cash flow effect (g) Recorded cash sales. O Cash inflow (h) Recorded sales on account. O No cash flow effect (i) Purchased inventory for cash. O Cash outflow (j) Purchased inventory on account. O No cash flow effect...
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## This note was uploaded on 04/01/2011 for the course ACCT COST ACCT taught by Professor Wang during the Spring '11 term at National Taiwan University.

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Ch13 statement of cash flowå¯¦ç¿’è§£ç­”

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