Question

Hampton Company reports the following information for its recent calendar year. Income Statement Data Selected Year-End Balance Sheet Data Sales $ 80,000 Accounts receivable increase $ 8,000 Expenses: Inventory decrease 3,000 Cost of goods sold 38,000 Salaries payable increase 700 Salaries expense 12,000 Depreciation expense 7,000 Net income $ 23,000 Required: Prepare the operating activities section of the statement of cash flows using the indirect method. (Amounts to be deducted should be indicated with a minus sign.)

Answer 1

Cash Flow From Operating Activities indicate the amount of cash and income that a company get from its ongoing day to day and regular business activities.

Operating activities from Hampton Company reports are Net income, Depreciation, Accounts receivable increase, Inventory decrease , Salaries payable increase

Cash flows from operating activities using the Indirect method

Net income 23,000

Depreciation 7,000

Accounts receivable increase -8,000

Inventory decrease 3,000

Salaries payable increase 700

Net cash provided by $25,700

operating activities