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Illusion [34]
3 years ago
15

Sheen Awnings reported net income of $90 million. Included in that number were depreciation expense of $3 million and a loss on

the sale of equipment of $2 million. Records reveal increases in accounts receivable, accounts payable, and inventory of $1 million, $4 million, and $3 million, respectively. What were Sheen’s cash flows from operating activities?
Business
1 answer:
Serggg [28]3 years ago
8 0

Answer:

The Sheen’s cash flows from operating activities is $95 million

Explanation:

Cash flows from operating activities :

The cash flow from operating activities includes all those activities which are of short term period. Like changes in working capital or we can say increase in currents assets or decrease in current assets or increase/decrease in current liabilities.

The increase in current liabilities increase the cash balance, hence it is added and decrease in current liabilities decrease the cash balance. But in the case of current asset, it is opposite.

The depreciation expense and loss on sale of equipment is added. So, we take them in the computation part.

The cash flow from operating activities is equals to

= Net income + depreciation expenses + loss on sale of equipment - increase in accounts receivable +  increase in accounts payable - increase in inventory

= $90 + $3 + $2 - $1 + $4 - $3

= $95 million

Hence, the Sheen’s cash flows from operating activities is $95 million

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In perfect competition, firms will be able to earn economic profits in the short run.

<h3>What is perfect competition?</h3>

A perfect competition is characterized by many buyers and sellers of homogenous goods and services.

In the long run, firms earn zero economic profit.  If in the short run firms are earning economic profit, in the long run firms would enter into the industry. This would drive economic profit to zero.

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2 years ago
The series of seven transactions recorded in the following T accounts were related to a sale to a customer on account and the re
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They are in order of A through E
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2 years ago
If a person drives an automobile, they are required by law to have automobile liability insurance. in which situation would this
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James backed into a vehicle in the grocery store parking lot and caused $2000 in damages to his own car and $3000 in damages to the other vehicle.
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3 years ago
On May 10, 2020, Cullumber Co. enters into a contract to deliver a product to Greig Inc. on June 15, 2020. Greig agrees to pay t
Likurg_2 [28]

Answer:

Date                 Particular                         Debit    Credit

May 10, 2020  No Entry (Note 1)                $0     $0

                         (To record contact entered into)

June 15, 2020  Account Receivable A/c  $1,810

                                To Sales Revenue A/c            $1,810

                         (To record Sales)

June 15, 2020   Cost of goods sold A/c.    $1,050

                                To Inventory A/c                        $1,050

                         (To record cost of goods sold)

July 15, 2020     Cash A/c                             $1,810

                                 To Account Receivable A/c      $1,810

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8 0
2 years ago
Item 3Item 3 Cutter Enterprises purchased equipment for $87,000 on January 1, 2018. The equipment is expected to have a five-yea
Rus_ich [418]

Answer:

$27,400 and $59,600

Explanation:

The computation of the depreciation expense and the book value using the sum of-the-years'-digits method is shown below:

Depreciation expense is

= (Purchase cost - residual value) × useful life ÷ sum of years

= ($87,000 - $4,800) × 5 years ÷ (5 + 4 + 3 + 2 + 1)

= $27,400

And, the book value is

= Purchase cost - depreciation expense

= $87,000 - $27,400

= $59,600

8 0
3 years ago
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