The income statement of Rodriquez Company

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Description

Problem 1

The income statement of Rodriquez Company is shown below.





















































RODRIQUEZ
COMPANY
INCOME STATEMENT
FOR THE YEAR ENDED DECEMBER 31, 2012



Sales






$6,894,600



Cost of goods sold







Beginning inventory




$1,893,870





Purchases




4,375,530





Goods available for sale




6,269,400





Ending inventory




1,608,650





Cost of goods sold






4,660,750



Gross profit






2,233,850



Operating expenses







Selling expenses




440,640





Administrative expenses




703,840




1,144,480



Net income






$1,089,370


Additional information:























1.




Accounts receivable decreased
$312,690 during the year.



2.




Prepaid expenses increased
$178,550 during the year.



3.




Accounts payable to suppliers of merchandise
decreased $281,970 during the year.



4.




Accrued expenses payable decreased
$124,510 during the year.



5.




Administrative expenses include depreciation
expense of $55,760.


Prepare the operating activities section of the statement of cash
flows using the direct method.

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