Question

Kingbird Corporation had the following 2020 income statement.

Sales revenue		$187,000
Cost of goods sold		111,000
Gross profit		76,000
Operating expenses (includes depreciation of $20,000)		54,000
Net income		$22,000

The following accounts increased during 2020: Accounts Receivable $14,000, Inventory $12,000, Accounts Payable $14,000. Prepare the cash flows from operating activities section of Kingbird’s 2020 statement of cash flows 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).)

Kingbird Corporation Statement of Cash Flows-Indirect Method (Partial) choose the accounting period December 31, 2020For the Year Ended December 31, 2020For the Quarter Ended December 31, 2020
select an opening section name Cash at Beginning of PeriodCash at End of PeriodCash Flows from Financing ActivitiesCash Flows from Investing ActivitiesCash Flows from Operating ActivitiesNet Cash Provided by Financing ActivitiesNet Cash Provided by Investing ActivitiesNet Cash Provided by Operating ActivitiesNet Cash Used by Financing ActivitiesNet Cash Used by Investing ActivitiesNet Cash Used by Operating ActivitiesNet Decrease in CashNet Increase in Cash
select an item Increase in InventoryCash Received from CustomersDecrease in Accounts PayableDecrease in InventoryCash Payment to SuppliersNet IncomeCash Payment for Operating ExpensesDepreciation expenseIncrease in Accounts PayableDecrease in Accounts ReceivableIncrease in Accounts Receivable		$enter a dollar amount
Adjustments to reconcile net income to
select an opening subsection name Cash at Beginning of PeriodCash at End of PeriodCash Flows from Financing ActivitiesCash Flows from Investing ActivitiesCash Flows from Operating ActivitiesNet Cash Provided by Financing ActivitiesNet Cash Provided by Investing ActivitiesNet Cash Provided by Operating ActivitiesNet Cash Used by Financing ActivitiesNet Cash Used by Investing ActivitiesNet Cash Used by Operating ActivitiesNet Decrease in CashNet Increase in Cash
select an item     Increase in Accounts Receivable    Cash Received from Customers    Depreciation expense    Increase in Accounts Payable    Decrease in Accounts Payable    Decrease in Accounts Receivable    Cash Payment for Operating Expenses    Increase in Inventory    Decrease in Inventory    Net Income    Cash Payment to Suppliers	$enter a dollar amount
select an item     Increase in Accounts Payable    Net Income    Depreciation expense    Increase in Inventory    Cash Received from Customers    Decrease in Accounts Payable    Decrease in Inventory    Decrease in Accounts Receivable    Cash Payment for Operating Expenses    Increase in Accounts Receivable    Cash Payment to Suppliers	enter a dollar amount
select an item     Depreciation expense    Increase in Accounts Payable    Decrease in Accounts Receivable    Decrease in Inventory    Net Income    Increase in Inventory    Cash Received from Customers    Cash Payment to Suppliers    Decrease in Accounts Payable    Cash Payment for Operating Expenses    Increase in Accounts Receivable	enter a dollar amount
select an item     Net Income    Decrease in Accounts Receivable    Increase in Inventory    Decrease in Inventory    Increase in Accounts Payable    Cash Received from Customers    Decrease in Accounts Payable    Increase in Accounts Receivable    Depreciation expense    Cash Payment to Suppliers    Cash Payment for Operating Expenses	enter a dollar amount
		enter a total amount of adjustments
select a closing section name Cash at Beginning of PeriodCash at End of PeriodCash Flows from Financing ActivitiesCash Flows from Investing ActivitiesCash Flows from Operating ActivitiesNet Cash Provided by Financing ActivitiesNet Cash Provided by Investing ActivitiesNet Cash Provided by Operating ActivitiesNet Cash Used by Financing ActivitiesNet Cash Used by Investing ActivitiesNet Cash Used by Operating ActivitiesNet Decrease in CashNet Increase in Cash		$enter a total amount for this section

Answer 1

Kingbird Corporation
Statement of Cash Flows-Indirect Method (Partial)
For the Year Ended December 31, 2020
Cash flow from Operating Activities
Net income		22,000
Add: Adjustments to reconcile net income to
Net cash provided by operating activities
Depreciation expense	20,000
Accounts receivable increase	-14,000
Inventory increase	-12,000
Accounts payable increase	14,000
		8,000
Net cash provided by Operating Activities		$30,000

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