Howard Company Uses the Direct Method to Prepare Its Operating

question 118

Essay

Howard Company uses the direct method to prepare its operating activities section of the statement of cash flows.
Indicate how each event affects net income and the three types of activities on the statement of cash flows. In the net income column, use the letter "I" to indicate increase, the letter "D" to indicate decrease, and the letters "NA" to indicate that the income statement is not affected. In the three cash flow columns, use the letter "I" to indicate cash inflow, the letter "D" to indicate cash outflow, and the letters "NA" to indicate that the cash flow statement is not affected.
Howard Company purchased land costing $25,000 by paying $8,000 cash and issuing a note payable for the remaining balance.

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Definitions:

Government Transfer Program

Programs operated by governments that redistribute income to individuals or groups without requiring any service or good in return.

American Families

Households in the United States characterized by diverse structures, sizes, and socioeconomic status.

Government Employment

Jobs or positions held within governmental organizations, including local, state, or federal levels.

Income Transfers

Financial distributions without a direct exchange of goods or services, aimed at reducing inequality and supporting individuals in need.