Solved

Wellington,Inc Use the Direct Method to Compute the Total Cash Receipts

question 24

Multiple Choice

Wellington,Inc.uses the direct method to prepare its statement of cash flows.Refer to the following financial statement information for the year ended December 31,2019: $Wellington,Inc.uses the direct method to prepare its statement of cash flows.Refer to the following financial statement information for the year ended December 31,2019: \begin{array}{c} \text {Wellington, Inc,}\\ \text {Income Statement}\\ \text {December 31,2019}\\\begin{array}{|l|r|l|} \hline\text { Sales Revenue } & \$ 289,600 & \\ \hline \text { Interest Revenue } & 2700 & \\ \hline \text { Gain on Sale of Plant Assets } & 6,000 & \\ \hline \text { Total Revenues and Gains } & & \$ 298,300\\ \hline\text { Cost of Goods Sold } & 145,000 \\ \hline \text { Salaries and Wages Expense } & 49,700 \\ \hline \text { Depreciation Expense - Plant Assets } & 16,000 \\ \hline \text { Other Operating Expense } & 24,300 \\ \hline\text { Interest Expense } & 3,500 \\ \hline \text { Income Tax Expense } & 7,800 \\ \hline \text { Total Expenses } &&246,300\\ \hline\text { Net Income }&&\$52,000\\ \hline \end{array}\end{array} Use the direct method to compute the total cash receipts from operating activities. A) $287,400 B) $294,500 C) $260,300 D) $296,100$ $\begin{array}{c}\text {Wellington, Inc,}\\\text {Income Statement}\\\text {December 31,2019}\\\begin{array}{|l|r|l|}\hline\text { Sales Revenue } & \$ 289,600 & \\\hline \text { Interest Revenue } & 2700 & \\\hline \text { Gain on Sale of Plant Assets } & 6,000 & \\\hline \text { Total Revenues and Gains } & & \$ 298,300\\\hline\text { Cost of Goods Sold } & 145,000 \\\hline \text { Salaries and Wages Expense } & 49,700 \\\hline \text { Depreciation Expense - Plant Assets } & 16,000 \\\hline \text { Other Operating Expense } & 24,300 \\\hline\text { Interest Expense } & 3,500 \\\hline \text { Income Tax Expense } & 7,800 \\\hline \text { Total Expenses } &&246,300\\\hline\text { Net Income }&&\$52,000\\\hline\end{array}\end{array}$ Use the direct method to compute the total cash receipts from operating activities.

Definitions:

Qualitative

Qualitative refers to descriptions or distinctions based on qualities rather than quantities, often used in research to assess non-numerical data.

Quantitative

Pertaining to data or research that deals with quantities, numbers, and statistical analysis, rather than interpretations or qualitative judgments.