Acc557 Financial Accounting: P13-3A The income statement of Whitlock Company

Acc557 Financial Accounting

P13-3A Prepare the operating activities section - indirect method
The income statement of Whitlock Company is presented here.
Whitlock Company
Income Statement
For the Year ended November 30, 2015
Sales revenue 7,700,000
Cost of goods sold
Beginning inventory 1,900,000
Purchases 4,400,000
Goods available for sale 6,300,000
Ending inventory 1,400,000
Total cost of goods sold 4,900,000
Gross profit 2,800,000
Operating expenses 1,150,000
Net income $1,650,000

Additional information:
1. Accounts receivable increased $200,000 during the year, and inventory decreased $500,000.
2. Prepaid expenses increased $150,000 during the year.
3. Accounts payable to suppliers of merchandise decreased $340,000 during the year.
4. Accrued expenses payable decreased $100,000 during the year.
5. Operating expenses include depreciation expense of $70,000.

Instruction:
Prepare the operating activities section of the statement of cash flows for the year ended November 30, 2015, for Whitlock Company, using the indirect method.
Powered by