80.2K

Verified Solution

Link Copied!

Cash flows from operating activities for both the indirect and direct methods are presented for Reverse Logic. All amounts are in thousands (000s).

Cash Flows from Operating Activities (Indirect method)
Net income	$	163
Adjustments to reconcile net income to net cash flows from operating activities:
Depreciation expense		51
Increase in accounts receivable		(27	)
Decrease in inventory		39
Increase in prepaid rent		(3	)
Decrease in accounts payable		(17	)
Decrease in income tax payable		(7	)
Net cash flows from operating activities					$	199
Cash Flows from Operating Activities (Direct method)
Cash received from customers	$	4,015
Cash paid to suppliers		(2,580	)
Cash paid for operating expenses		(1,150	)
Cash paid for income taxes		(86	)
Net cash flows from operating activities					$	199

Required:

Complete the following income statement for Reverse Logic. Assume all accounts payable are to suppliers. (Enter your answers in thousands (i.e., 10,000,000 should be entered as "10,000).)

3,988 REVERSE LOGIC Income Statement For the Year Ended December 31, 2021 Net sales $ Expenses: Cost of goods sold Operating expenses Depreciation expense 51 Income tax expense Total expenses Net income $ 163

Answer & Explanation Solved by verified expert

See Answer