WHITLOCK COMPANY Income Statement For the Year Ended Novembe

WHITLOCK COMPANY Income Statement For the Year Ended November 30, 2017 ales revenue $7,445,200 ost of goods sold Beginning inventory $1,902,700 4,414,000 6,316,700 1,330,700 Purchases Goods available for sale Ending inventory Total cost of goods sold Gross profit Operating expenses Net income 4,986,000 2,459,200 1,196,200 $1,263,000 Additional information: 1. Accounts receivable increased $190,000 during the year, and inventory decreased $572,000. 2. Prepaid expenses increased $169,900 during the year. 3. Accounts payable to suppliers of merchandise decreased $342,700 during the year 4. Accrued expenses payable decreased $106,900 during the year 5. Operating expenses include depreciation expense of $97,800. Prepare the operating activities section of the statement of cash flows for the year ended November 30, 2017, for Whitlock Company, using the indirect method amounts that decrease cash flow with either a -sign e.g.-15,000 or in parenthesis e.g. (15,000).)

Solution

Cash flows from operating activities: Net income 1263000 Adjustments to reconcile net income to Net cash provided by operating activities Depreciation expense 97800 Decrease in inventory 572000 Decrease in Accrued expenses payable -106900 Increase in Prepaid expenses -169900 Increase in Accounts Receivable -190000 Decrease in Accounts Payable -342700 -139700 Net cash provided by operating activities 1123300