Explain How the Following Transactions Should Be Reported in the Statement

question 57

Essay

Explain how the following transactions should be reported in the statement of cash flows, assuming the indirect method is used to determine cash flows from operating activities. Identify all available options. If not reported on the statement of cash flows, indicate the disclosure requirements, if any.
1. Income tax expense of $30,000. The income tax payable account increased $7,000, while the deferred income tax liability account decreased $9,000.
2. Cash dividend of $40,000 declared. The dividends payable account increases $25,000.

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Definitions:

Confederate Army

The military ground forces of the Confederate States of America during the American Civil War, fighting against the Union.

Wartime Presidents

Leaders who served as the head of a country during periods of conflict, charged with making critical decisions about national security, military strategy, and domestic wartime measures.

Abraham Lincoln

The 16th President of the United States, who led the country through its Civil War and played a key role in the abolition of slavery.

Jefferson Davis

The President of the Confederate States of America during the American Civil War (1861-1865), known for his leadership of the Confederacy in its attempt to establish independence from the United States.