Question

Lansing Company’s 2018 income statement and selected balance sheet data (for current assets and current liabilities) at December 31, 2017 and 2018, follow.
LANSING COMPANY
Income Statement
For Year Ended December 31, 2018
Sales revenue $ 100,200
Expenses Cost of goods sold 43,000
Depreciation expense 12,500
Salaries expense 19,000
Rent expense 9,100
Insurance expense 3,900
Interest expense 3,700
Utilities expense 2,900
Net income $ 6,100
LANSING COMPANY
Selected Balance Sheet Accounts
At December 31 2018 2017 Accounts receivable $ 5,700 $ 6,000 Inventory 2,080 1,590 Accounts payable 4,500 4,800 Salaries payable 900 710 Utilities payable 240 170 Prepaid insurance 270 300 Prepaid rent 240 190 Required:
Prepare the cash flows from operating activities section only of the company’s 2018 statement of cash flows using the direct method. (Amounts to be deducted should be indicated with a minus sign.)

Answer 1

Net cash flows provided by operating activities is $21,200.

Operating cash flows using the indirect technique

2018-12-31 For the Year Ended

Flows of money from operations

6,600.00 was the net profit.

Ratio of net income to operating cash flow adjustments

Items not affecting the income statement Cash

Cost of depreciation: $15,000.00

Current Operating Assets and Liabilities Changes

$800.00 less in accounts receivable

A rise in inventory prices (740.00)

$80.00 less in prepaid insurance

Prepaid rent increased in price (100.00)

Reduced amount owed in accounts payable (800.00)

Payable Salary Increase of $ 240.00

Utilities payable increased by $ 120.

$ 14,600.00

$ 21,200.00 in net cash flows from operating activities.

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