Use the Following Income Statement and Information About Selected Current

question 107

Essay

Use the following income statement and information about selected current assets and current liabilities for Kimberline Industries to calculate the net cash provided or used by operating activities using the indirect method.
$\begin{array}{c}\text {KMMBERLINE INDUSTRIES}\\\text {Income Statement}\\\text {For Year Ended December 31, 20X1}\\\begin{array}{|l|r|r|}\hline\text { Sales } & & \$ 280,000 \\\hline\text { Cost of goods sold } & & 124,000 \\\hline \text { Gross profit from sales } & & \$ 156,000 \\\hline \text { Operating expenses: } & & \\\hline \text { Salaries and wages expense } & \$ 35,000 & \\\hline \text { Depreciation expense } & 11,000 \\\hline \text { Rent expense } & 27,200 & \\\hline \text { Interest expense } & 3,900 & 77,100 \\\hline \text { Income from operations } & & \$ 78,900 \\\hline \text { Loss on sale of land } & & 4,700 \\\hline \text { Net income } & & \$ 74,200 \\\hline\end{array}\end{array}$ Increases and decreases of current asset and current liability accounts, all of which relate to operating activities, are as follows:
$$\begin{array} { | l | r | } \hline &{ \text { Change } } \\\hline \text { Accounts receivable increase } & \$ 3,600 \\\hline \text { Merchandise inventory decrease } & 1,700 \\\hline \text { Accounts payable increase } & 1,100 \\\hline \text { Salaries and wages payable decrease } & 2,600 \\\hline\end{array}$$

---

Definitions:

Intermittent Reinforcement

A conditioning schedule where a response is only sometimes reinforced, known to significantly increase the rate of response and resistance to extinction.

Continuous Reinforcement

A form of learning in which a behavior is reinforced every time it occurs, leading to rapid acquisition of the behavior.

Extinction

In behavioral psychology, the gradual weakening and eventual disappearance of a conditioned response, typically because the reinforcement is withheld.

Social Learning Theory

A theory that suggests individuals learn behaviors, attitudes, and emotions through observing others, rather than through direct experience alone.