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Calculating Net Cash Flow from Operating Activities (Indirect Method) Lincoln Company owns no plant assets...

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Accounting

Calculating Net Cash Flow from Operating Activities (Indirect Method)

Lincoln Company owns no plant assets and reported the following income statement for the current year:

Sales $755,000
Cost of Goods Sold $470,000
Wages Expense 110,000
Rent Expense 42,000
Insurance Expense 15,000 637,000
Net Income $118,000

Additional balance sheet information about the company follows:

End of Year Beginning of Year
Accounts Receivable $54,000 $49,000
Inventory 60,000 66,000
Prepaid Insurance 8,000 7,000
Accounts Payable 22,000 18,000
Wages Payable 9,000 11,000

Use the information to

a. Calculate the net cash flow from operating activities under the indirect method.
$Answer

b. Compute Lincoln Company's operating cash flow to current liabilities (OCFCL) ratio. (Assume current liabilities consist of accounts payable and wages payable.)
(Round your answer to two decimal places.)
Answer

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