Portions of the financial statements for BLANK Products are
provided below.
BLANK PRODUCTS COMPANY Income Statement For the Year Ended December 31, 2024 ($ in millions) |
|||||||
Sales | $ | 600 | |||||
Cost of goods sold | 210 | ||||||
Gross margin | 390 | ||||||
Salaries expense | $ | 80 | |||||
Depreciation expense | 70 | ||||||
Amortization expense | 5 | ||||||
Interest expense | 10 | ||||||
Loss on sale of land | 3 | 168 | |||||
Income before taxes | 222 | ||||||
Income tax expense | 111 | ||||||
Net Income | $ | 111 | |||||
BLANK PRODUCTS COMPANY Selected Accounts from Comparative Balance Sheets December 31, 2024 and 2023 ($ in millions) |
|||||||||
Year | |||||||||
2024 | 2023 | Change | |||||||
Cash | $ | 105 | $ | 102 | $ | 3 | |||
Accounts receivable | 222 | 235 | (13 | ) | |||||
Inventory | 441 | 452 | (11 | ) | |||||
Accounts payable | 145 | 138 | 7 | ||||||
Salaries payable | 81 | 88 | (7 | ) | |||||
Interest payable | 28 | 22 | 6 | ||||||
Income tax payable | 18 | 12 | 6 | ||||||
Required:
Prepare the cash flows from the operating activities section of the
statement of cash flows for BLANK Products Company using the
indirect method. (Enter your answers in millions
(i.e., 10,000,000 should be entered as 10). Amounts to be deducted
should be indicated with a minus sign.)
($ in millions)
Cash Flows from Operating Activities:
Net incomeAdjustments for noncash effects: (5 lines)
Changes in operating assets and liabilities: (7 lines)
Net cash flows from operating activities
Cash flows from operating activities | ||
Net Income | $ 111.00 | |
Adjustments for noncash effects: | ||
Depreciation expense | $ 70.00 | |
Amortization expense | $ 5.00 | |
Loss on sale of land | $ 3.00 | |
Changes in operating assets and liabilities | ||
Decrease in accounts receivable | $ 13.00 | |
Decrease in inventory | $ 11.00 | |
Increase in accounts payable | $ 7.00 | |
Decrease in salaries payable | $ (7.00) | |
Increase in interest payable | $ 6.00 | |
Increase in income tax payable | $ 9.00 | |
$ 117.00 | ||
net cash flows operating activities | $ 228.00 |
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