The Cash Flows from Operating Activities Are Reported by the Direct

question 54

Short Answer

The cash flows from operating activities are reported by the direct method on the statement of cash
flows.
1)2)Determine the following:
If sales for the current year were $695,000 and accounts receivable decreased by $43,500 during the year, what was the amount of cash received from customers?
If income tax expense for the current year was $56,000 and income tax payable
decreased by $5,200 during the year, what was the amount of cash payments of income tax?

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Definitions:

Equal Rights

refers to the principle of granting all people the same legal rights, without discrimination on the basis of characteristics such as race, gender, or religion.

General Partnership

A type of business partnership where two or more partners share unlimited liability for the debts and obligations of the business.

Fiduciary Duty

A legal obligation of one party to act in the best interest of another, typically within a trustee-beneficiary, advisor-client, or director-shareholder relationship.

UPA

The Uniform Partnership Act, a law in the United States that provides a basic framework for the operation of partnerships.