Computing and Comparing Income and Cash Flow Measures
Penno Corporation recorded service revenues of $ during the most recent fiscal year, of which $ were on credit and $ were for cash. Moreover, of the $ credit sales, Penno collected $ cash on those receivables before yearend. The company also paid $ cash for wages for the year. Its employees also earned another $ in wages during the year, which were not yet paid at yearend.
a Compute the company's net income for the fiscal year.
b How much net cash inflow or outflow did the company generate during the year?
Note: Enter net cash inflow as positive and net cash outflow as negative.
Explain why Penno's net income and net cash flow differ.
Note: Do not use a negative sign below.
Cash inflow from services rendered will be $ than service revenue per the income statement because Penno only collected of revenues in cash but reported as revenue.
Cash outflow for wages paid will be $ than wages expense on the income statement because remained unpaid at yearend.
