Arundel company disclosed the following information

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Reference no: EM13899997

Arundel Company disclosed the following information for its recent calendar year.

Revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 100,000 
Expenses Salaries expense . . . . . . . . . . . . . . 84,000
Utilities expense . . . . . . . . . . . . . . . . . . . . 14,000 
Depreciation expense . . . . . . . . . . . . . . . . 14,600 
Other expenses . . . . . . . . . . . . . . . . . . . . 3,400 
Net loss . . . . . . . . . . . . . . . . . . . . . . . . . . . $ (16,000) 
Accounts receivable decrease . . . . . . . . . . . $ 24,000 
Purchased a machine . . . . . . . . . . . . . . . . . . . 10,000 
Salaries payable increase . . . . . . . . . . . . . . . . 18,000 
Other accrued liabilities decrease . . . . . . . . 8,000

Required: 

1. Prepare the operating activities section of the statement of cash flows using the indirect method. 
2. What were the major reasons that this company was able to report a net loss but positive cash flow from operations? 
3. Of the potential causes of differences between cash flow from operations and net income, which are the most important to investors?

Reference no: EM13899997

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