Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. preparing the operating activities section the fol

Preparing the Operating Activities Section The following items are relevant to the preparation of a...

80.2K

Verified Solution

Question

Accounting

image

Preparing the Operating Activities Section The following items are relevant to the preparation of a statement of cash flows for Maxwell Inc. 1. Net loss for the year was $36,000. Depreciation expense was $90,000. 3. Pension expense is $180,000 while funding for the pension plan was $144,000. 4. Deferred tax liability increased $144,000, income taxes payable decreased $36,000, and income tax expense was $396,000. 5. $36,000 of interest was capitalized. Interest expense recognized is $180,000. There is no change in interest payable. 6. Sold short-term investments (not held in a trading account) at a $7,200 gain, proceeds $28,800. 7. Merchandise inventory decreased by $18,000, accounts payable decreased by $9,000, and salaries payable increased by $25,200. Required Prepare the reconciliation of net income with cash flow from operations for inclusion in the statement of cash flows (indirect method). Note: If an item is not included in the operating activities section, leave the answer blank (zero)

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students