Avatar Company Uses the Direct Method to Prepare Its StatementPrepare the Operating Activities Section of the Statement of Cash

The Answer of Avatar Company Uses the Direct Method to Prepare Its StatementPrepare the Operating Activities Section of the Statement of Cash

Avatar Company Uses the Direct Method to Prepare Its StatementPrepare the Operating Activities Section of the Statement of Cash

The Answer of Avatar Company Uses the Direct Method to Prepare Its StatementPrepare the Operating Activities Section of the Statement of Cash

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Avatar Company Uses the Direct Method to Prepare Its Statement

question 4

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Avatar Company uses the direct method to prepare its statement of cash flows. Refer to the following financial statement information for the year ending December 31, 2015:
$Avatar Company uses the direct method to prepare its statement of cash flows. Refer to the following financial statement information for the year ending December 31, 2015: \begin{array}{c} \text {Avatar Company }\\ \text {Income Statement }\\ \text {Year Ended December 31, 2015}\\ \begin{array}{lll} \text {Sales Revenue}\\ \text {Interest Revenue}\\ \text {Gain on Sale of Plant Assets}\\ \text {Total Revenues and Gains}\\ \text {Cost of Goods Sold}\\ \text {Salaries and Wages Expense}\\ \text {Depreciation Expense-Plant Assets}\\ \text {Other Operating Expense}\\ \text {Interest Expense}\\ \text {Income Tax Expense}\\ \text {Total expenses}\\ \text {Net Income} \end{array} \begin{array}{r} \$ 291,300 \\ 1,000 \\ \underline{6,000} \\ \$ 298,300 \\ 145,000 \\ 49,000 \\ 16,000 \\ 25,000 \\ 3,500 \\ \underline{7,800} \\ \underline{246,300} \\ \underline{\$ 52,000} \\ \end{array} \end{array} \begin{array}{c} \text {Avatar Company}\\ \text {Statement of Retained Earnings}\\ \text {Year Ended December 31, 2015}\\ \begin{array}{lll} \text {Retained Earnings, January 1, 2014}\\ \text {Add: Net income}\\ \text {Less: Dividends}\\ \text {Retained Earnings, December 31, 2014} \end{array} \begin{array}{r} \$ 78,000 \\ 52,000 \\ \underline{15,000} \\ \underline{\underline{\$ 115,000}} \\ \end{array} \end{array} Prepare the operating activities section of the statement of cash flows, using the direct method.$
$\begin{array}{c} \text {Avatar Company }\\ \text {Income Statement }\\ \text {Year Ended December 31, 2015}\\\begin{array}{lll} \text {Sales Revenue}\\ \text {Interest Revenue}\\ \text {Gain on Sale of Plant Assets}\\ \text {Total Revenues and Gains}\\ \text {Cost of Goods Sold}\\ \text {Salaries and Wages Expense}\\ \text {Depreciation Expense-Plant Assets}\\ \text {Other Operating Expense}\\ \text {Interest Expense}\\ \text {Income Tax Expense}\\ \text {Total expenses}\\ \text {Net Income}\end{array}\begin{array}{r}\$ 291,300 \\1,000 \\\underline{6,000} \\\$ 298,300 \\145,000 \\49,000 \\16,000 \\25,000 \\3,500 \\\underline{7,800} \\ \underline{246,300} \\\underline{\$ 52,000} \\\end{array}\end{array}$

$\begin{array}{c} \text {Avatar Company}\\ \text {Statement of Retained Earnings}\\ \text {Year Ended December 31, 2015}\\\begin{array}{lll} \text {Retained Earnings, January 1, 2014}\\ \text {Add: Net income}\\ \text {Less: Dividends}\\ \text {Retained Earnings, December 31, 2014} \end{array}\begin{array}{r}\$ 78,000 \\52,000 \\\underline{15,000} \\\underline{\underline{\$ 115,000}} \\ \end{array}\end{array}$

Prepare the operating activities section of the statement of cash flows, using the direct method.

Definitions:

Key Persons

Individuals who hold critical importance within an organization or project, often due to their skills, knowledge, or position.

BCG Matrix

A strategic business tool designed by the Boston Consulting Group to help organizations evaluate and manage the relative positions of their business units or products in terms of market growth rate and market share.

Stars

High-performing and highly valuable members or units within an organization known for contributing significantly to its success.

Question Marks

Products or business units that operate in high growth markets but have a low market share, often requiring significant resources to become profitable.