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Fictitious information is provided below. Answer both required questions. **Be sure to show your work in...

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Accounting

Fictitious information is provided below. Answer both requiredquestions. **Be sure to show your work in detail. Not doing so willresult in reduced or no credit given.

For the year recently completed, TeamLogicIT had net income of$35,000. Balances in the company's current asset and currentliability accounting for the beginning and ending of the year wereas follows:

End of YearBeginning of Year
Current assets:
Cash and cash equivalents$30,000$40,000
Accounts receivable$125,000$106,000
Inventory$213,000$180,000
Prepaid expenses$6,000$7,000
Current liabilities:
Accounts payable$210,000$195,000
Accrued liabilities$4,000$6,000
Income taxes payable$34,000$30,000

Also, the accumulated depreciation account had total credits of$20,000 during the year. TeamLogicIT did not record any gains orlosses during the year.

**Based on the above and in consideration of the indirectmethod, determine the net cash provided by operating activities forthe year.

Answer & Explanation Solved by verified expert
3.8 Ratings (519 Votes)

Cash flows statement (partial)
Cash flows from operating Activities:
Net income        35,000
Adjustments to reconcile net income to
net cash provided by operating activities :
Depreciation Expense            20,000
Increase in Accounts Receivable           -19,000
Increase in Inventory           -33,000
Decrease in Accounts Receivable              1,000
Increase in Accounts Payable            15,000
Decrease in Accrued liabilties             -2,000
Increase in Income taxes payable              4,000
      -14,000
Net cash provided by operating activities        21,000

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