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Suppose your company sells services for $325 cash this month. Your company also pays $100 in wages, which includes $15 that was payable at the end of the previous month and $85 for wages of this month.Required:1. Show the journal entries to record these transactions.2. Calculate the amount that should be reported as net cash flow from operating activities.3. Calculate the amount that should be reported as net income.4. Show how the indirect method would convert net income (requirement 3) to net cash flow from operating activities (requirement 2).5. What general rule about converting net income to operating cash flows is revealed by your answer to requirement 4?

Respuesta :

The following data is accessible when creating a company's statement of cash flows for the most recent year using the indirect method: The company's yearly net income was $57,500.

Payments to creditors fell by 23,500. The amount of money owed rose by $32,500. Stocks went up by 10,000. 15,100 in cash dividends were paid. The cost of depreciation was 25,500. The amount of operating activities' net cash flow was In this scenario, we are creating a cash flow statement for businesses. We're interested in the net income generated by operating activities. A query arose regarding the following funds generated by operating activities. This is the most current year's cash flow statement for the corporation.

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