Solution-Create a cash flows document from operating

Create a cash flows document from operating activities

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Reference no: EM132360477

Question

Scenario

Below is information from the Biddle Company income statement and current assets and current liabilities from the balance sheet as of December 31, 2017 and 2018.

Biddle Company Income Statement For Year Ended December 31, 2018 Sales revenue S 142,200 Expenses
Cost of goods sold	S 57,000
Depreciation expense	S 19,500
Salaries expense	S 33,000
Rent expense	S 10,500
Insurance expense	S 5,300
Interest expense	S 5,100
Utilities expense	S 4,300
Net income	S 7,500

Biddle Company
Selected Balance Sheet Accounts

At December 31	2018	2017
Accounts receivable	$ 7,100	$ 8,800
Inventory	$ 3,480	$ 2,290
Accounts payable	$ 5,900	S 7,600
Salaries payabl e	$ 1,180	5 850
Utilities payable	S 520	S 310
Prepaid insurance	S 410	S 580
Prepaid rent	S 520	S 330

Questions

1. Create a cash flows document from operating activities section of the company's 2018 statement of cash flows using the direct method.

2. Create a cash flows document from operating activities section of the company's 2018 statement of cash flows using the indirect method.

3. Compare the two statements of cash flows and comment on the differences.

Reference no: EM132360477

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Create a cash flows document from operating activities

Reference no: EM132360477

Reference no: EM132360477

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