Question

Under the indirect method, the reconciliation of net income to operating cash flows Select one: a....

Under the indirect method, the reconciliation of net income to operating cash flows

Select one:

a. Is required on the face of the statement of cash flows.

b. Is required as a separate schedule.

c. Is not required, but is highly encouraged for inclusion on the face of the statement of cash flows.

d. Is required on the face of the statement of cash flows or as a separate schedule.

Business   Accounting   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

The Answer is A. Is required on the face of the statement of cash flows.

Explanation:

1) Indirect method of cash flow statement starts with net income and reconciliation of it to operating cash flows is necessary to arrive at total cash flow from operating activity.

2) As cash flow statement starts with net income, it is a face of the statement.

3) Option B is not correct because reconciliation of net income should be done on the face but not as a separate schedule.

4) Option C is not correct because reconciliation of net income is required.

5) Option D is not correct because reconciliation of net income is required only on the face of the statement of cash flow but not as separate schedule.

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Cash Flows from Operating Activities—Indirect Method The net income reported on the income statement for the...
Cash Flows from Operating Activities—Indirect Method The net income reported on the income statement for the current year was $144,400. Depreciation recorded on store equipment for the year amounted to $23,800. Balances of the current asset and current liability accounts at the beginning and end of the year are as follows: End of YearBeginning of Year Cash$58,770 $54,070 Accounts receivable (net)42,140 39,960 Inventories57,540 60,830 Prepaid expenses6,460 5,140 Accounts payable (merchandise creditors)55,070 51,150 Wages payable30,090 33,420 a. Prepare the “Cash flows...
Cash Flows from Operating Activities—Indirect Method The net income reported on the income statement for the...
Cash Flows from Operating Activities—Indirect Method The net income reported on the income statement for the current year was $146,100. Depreciation recorded on store equipment for the year amounted to $24,100. Balances of the current asset and current liability accounts at the beginning and end of the year are as follows: End of Year Beginning of Year Cash $58,590 $53,320 Accounts receivable (net) 42,010 39,400 Merchandise inventory 57,360 59,990 Prepaid expenses 6,440 5,070 Accounts payable (merchandise creditors) 54,900 50,440 Wages...
Direct or indirect? Most companies report operating cash flows using the ___________ method. Net income is...
Direct or indirect? Most companies report operating cash flows using the ___________ method. Net income is reconstructed on a cash basis when the ___________ method is used to report the net cash flows provided (used) by operating activities. The net cash amount provided by operating activities using the direct method is ____________ that computed using the indirect methods. The FASB recommends that the operating activities section of the statement of cash flows be reported using the ____________ method.
Cash Flows from Operating Activities—Indirect Method The net income reported on the income statement for the...
Cash Flows from Operating Activities—Indirect Method The net income reported on the income statement for the current year was $202,100. Depreciation recorded on equipment and a building amounted to $60,400 for the year. Balances of the current asset and current liability accounts at the beginning and end of the year are as follows: End of Year Beginning of Year Cash $51,330 $54,410 Accounts receivable (net) 65,090 67,140 Inventories 128,330 115,680 Prepaid expenses 7,130 7,670 Accounts payable (merchandise creditors) 57,340 60,720...
Cash Flows from Operating Activities—Indirect Method The net income reported on the income statement for the...
Cash Flows from Operating Activities—Indirect Method The net income reported on the income statement for the current year was $135,100. Depreciation recorded on store equipment for the year amounted to $22,300. Balances of the current asset and current liability accounts at the beginning and end of the year are as follows: End of Year Beginning of Year Cash $53,630 $49,340 Accounts receivable (net) 38,450 36,460 Merchandise inventory 52,500 55,510 Prepaid expenses 5,900 4,690 Accounts payable (merchandise creditors) 50,250 46,680 Wages...
Cash Flows from Operating Activities—Indirect Method The net income reported on the income statement for the...
Cash Flows from Operating Activities—Indirect Method The net income reported on the income statement for the current year was $117,600. Depreciation recorded on store equipment for the year amounted to $19,400. Balances of the current asset and current liability accounts at the beginning and end of the year are as follows: End of Year Beginning of Year Cash $45,630 $41,520 Accounts receivable (net) 32,720 30,680 Merchandise inventory 44,670 46,710 Prepaid expenses 5,020 3,940 Accounts payable (merchandise creditors) 42,760 39,280 Wages...
Cash Flows from Operating Activities—Indirect Method The net income reported on the income statement for the...
Cash Flows from Operating Activities—Indirect Method The net income reported on the income statement for the current year was $126,900. Depreciation recorded on store equipment for the year amounted to $20,900. Balances of the current asset and current liability accounts at the beginning and end of the year are as follows: End of Year Beginning of Year Cash $51,650 $47,520 Accounts receivable (net) 37,030 35,120 Merchandise inventory 50,570 53,460 Prepaid expenses 5,680 4,510 Accounts payable (merchandise creditors) 48,400 44,950 Wages...
Cash Flows from Operating Activities—Indirect Method The net income reported on the income statement for the...
Cash Flows from Operating Activities—Indirect Method The net income reported on the income statement for the current year was $128,200. Depreciation recorded on store equipment for the year amounted to $21,200. Balances of the current asset and current liability accounts at the beginning and end of the year are as follows: End of Year Beginning of Year Cash $49,100 $45,170 Accounts receivable (net) 35,200 33,380 Inventories 48,070 50,820 Prepaid expenses 5,400 4,290 Accounts payable (merchandise creditors) 46,010 42,730 Wages payable...
Cash Flows from Operating Activities—Indirect Method The net income reported on the income statement for the...
Cash Flows from Operating Activities—Indirect Method The net income reported on the income statement for the current year was $120,600. Depreciation recorded on store equipment for the year amounted to $19,900. Balances of the current asset and current liability accounts at the beginning and end of the year are as follows: End of Year Beginning of Year Cash $49,330 $44,890 Accounts receivable (net) 35,370 33,170 Inventories 48,290 50,500 Prepaid expenses 5,430 4,260 Accounts payable (merchandise creditors) 46,220 42,470 Wages payable...
Cash Flows from Operating Activities—Indirect Method The net income reported on the income statement for the...
Cash Flows from Operating Activities—Indirect Method The net income reported on the income statement for the current year was $244,900. Depreciation recorded on equipment and a building amounted to $73,200 for the year. Balances of the current asset and current liability accounts at the beginning and end of the year are as follows: End of Year Beginning of Year Cash $64,900 $68,790 Accounts receivable (net) 82,290 84,890 Inventories 162,250 146,250 Prepaid expenses 9,020 9,700 Accounts payable (merchandise creditors) 72,490 76,770...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT