145. Cash flows from operating activities-indirect method
In the computation of net cash flows from operating activities for 2009 by the indirect method, determine whether each of the following items would be added to net income, deducted from net income, or omitted from the computation. Indicate your answer by using the following symbols: + (added to net income), - (deducted from net income), or 0 (omitted from computation).
____ (a) A decrease in accounts payable to suppliers of merchandise during 2009.
____ (b) A loss recognized on the sale of office equipment during 2009.
____ (c) Depreciation expense for 2009.
____ (d) Dividends, declared at the end of last year, paid to shareholders during the current year.
____ (e) An increase in inventory levels during 2009.
____ (f) A decrease in accounts receivable from customers during 2009.
146. Cash flow from operations activities-indirect method
An analysis of the 2010 financial statements of Portside Provisions reveals the following:
(a) Accounts payable to suppliers of merchandise decreased by $65,000 during 2010.
(b) Dividends of $135,000 were declared in November 2010, to be paid in January 2011.
(c) Dividends of $120,000, declared in November 2009, were paid in January 2010.
(d) Inventory levels increased by $91,000 during 2010.
(e) Depreciation expense for 2010 amounted to $53,000.
(f) Land, which had a cost of $350,000, was sold in 2010 for $400,000 cash, resulting in a gain of $50,000.
(g) Net income for 2010 was $745,000.
Using only the above information, follow the indirect method to compute Portside Provisions' net cash flows from operating activities for 2010.
Computations