Based on the Following Income Statement and Balance Sheet for Bankowski

question 125

Essay

Based on the following income statement and balance sheet for Bankowski Corporation, determine the cash flows from operating activities using the indirect method.
$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\text {Bankowski Corporation}$
$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\text {Income Statement}$
$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\text {For Year Ended December 31, 20X2}$
$\begin{array} { | l | r | r | } \hline \text { Sales } & & \$ 504,000 \\\hline \text { Cost of goods sold } & \$ 327,600 & \\\hline \text { Depreciation expense } & 33,000 & \\\hline \text { Other operating expenses } & \underline { 125,500 } ( 486,100 ) \\\hline \text { Other gains (losses): } & & \\\hline \text { Gain on sale of equipment } & & \underline { 5,200 } \\\hline \text { Income before taxes } & & 23,100 \\\hline \text { Net income tax expense } & & \underline { ( 4,800 ) } \\\hline & & \\\hline\end{array}$

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Definitions:

Production Cost

Production cost is the total expense incurred in the process of creating goods or services, including raw materials, labor, and overhead costs.

Conversion Costs

Refers to the combined costs of direct labor and manufacturing overheads that are incurred to convert raw materials into finished goods.

Manufacturing Costs

Costs that are directly associated with the manufacturing of products, including raw materials, workforce expenses, and indirect costs.

Work in Process

Inventories that are currently in the production process and have not yet reached the final stage to be classified as finished goods.