Question

The current sections of Shamrock, Inc.’s balance sheets at December 31, 2016 and 2017, are presented here. Shamrock, Inc.’s net income for 2017 was $ 153,612. Depreciation expense was $ 27,108.

		2017		2016
Current assets
Cash		$ 105,420		$ 99,396
Accounts receivable		80,320		89,356
Inventory		168,672		172,688
Prepaid expenses		27,108		22,088
Total current assets		$ 381,520		$ 383,528
Current liabilities
Accrued expenses payable		$ 15,060		$ 5,020
Accounts payable		85,340		92,368
Total current liabilities		$ 100,400		$ 97,388

Prepare the net cash provided (used) by operating activities section of the company’s statement of cash flows for the year ended December 31, 2017, using the indirect method. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).)

Shamrock, Inc. Partial Statement of Cash Flows
Adjustments to reconcile net income to

Answer 1

Solution:

Cash flow Statement (Partial) For the Year ended Dec 31, 2017
Particulars	Details	Amount
Cash Flow from Operating Activities:
Net Income		$1,53,612.00
Adjustments to reconcile net income to cash flow from operating activities:
Depreciation	$27,108.00
Decrease in Accounts Receivables ($89356 -$80320)	$9,036.00
Decrease in Inventory ($172688 -$168672)	$4,016.00
Increase in Prepaid Expense ($22088 - $27108)	-$5,020.00
Increase in Accrued Expenses Payable ($15060-$5020)	$10,040.00
Decrease in Accounts Payable ($85340 - $92368)	-$7,028.00
Total Adjustments		$38,152.00
Net Cash Flow From Operating Activites		$1,91,764.00