Neutral Paints Company uses the direct method for preparing its statement of cash flow
Neutral reports the following information regarding 2017:
From the income statement:
Sales Revenues, $266,000
Cost of Goods Sold, $215,000
Operating Expenses, $37,000
From the balance sheet:
Beginning Balance Ending Balance
Accounts Receivable $14,500 $18,000
Merchandise Inventory 23,800 17,800
Accounts Payable 6,200 13,700
Accrued Liabilities 4,400 1,500
What amount will be shown for payments to suppliers for operating expenses? (Accounts Payable are for purchases of merchandise inventory only, and Accrued Liabilities relate to operating expenses.)
A) $39,900
B) $37,000
C) $35,500
D) $41,400
A .A)
Accrued Liabilities, beginning balance $4,400
Add: Operating Expenses 37,000
Less: Accrued Liabilities, ending balance ($1,500 )
Cash Paid for Operating Expenses $39,900
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