The Following Account Balances Are for the Noncash Current Assets

question 36

Essay

The following account balances are for the noncash current assets and current liabilities of Sam's Surfboard Shop for 2010 and 2011:
In addition, the income statement for 2011 is as follows:
Required: Prepare the operating activities section of the statement of cash flows using the indirect method.

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Definitions:

Vertical Financial Statement Analysis

The examination of a company's financial statements to understand the relationships between individual items and the total, usually expressed as a percentage.

Applied

Refers to a concept or method that has been put into practice or use.

Horizontal Financial Statement Analysis

A method of evaluating financial statements to determine their performance over a period by comparing historical figures.

Applied

In accounting and finance, this term refers to the allocation of costs or payments towards specific objectives, accounts, or purposes.