Nebraska Auto Parts Company Uses the Indirect Method to Prepare

question 12

Essay

Nebraska Auto Parts Company uses the indirect method to prepare the statement of cash flows.Refer to the following income statement:
Additional information provided by the company includes the following:
Current assets other than cash increase by $36,000.
Current liabilities decrease by $1,500.
Prepare the operating activities section of the statement of cash flows.

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Definitions:

GAAP

Generally Accepted Accounting Principles are the set of rules, standards, and practices formally accepted as guidelines for financial reporting in the U.S.

Technological Feasibility

The point at which a company can demonstrate that a new technology or product can be produced reliably, efficiently, and at a scalable level, often affecting the capitalization of development costs.

Franchise Costs

Expenses incurred by a franchisee for acquiring the rights to operate a franchised business, including initial fees and ongoing royalties.

Patent Infringement Suit

A legal case brought by a patent holder against another party accused of using, making, or selling a patented invention without permission.