The Cash Flows from Operating Activities Are Reported by the Direct

question 13

Essay

The cash flows from operating activities are reported by the direct method on the statement of cash flows. Determine the following:
(a)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?
(b)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:

Oil And Gas

Natural hydrocarbons that are extracted from the Earth and used as fuel sources for heating, transportation, and the generation of electricity.

Coal

A fossil fuel consisting mainly of carbonized plant matter, found underground and used for energy production.

Oil Shale

A sedimentary rock consisting of organic materials that can be processed to produce shale oil, a type of unconventional petroleum.

Geologic Structure

The arrangement and relationship of rock layers and formations, shaped by tectonic forces, that reveals the history of Earth's crust.