Operating expenses other than depreciation for the year were $563,000.Accrued expenses decreased by $47,000.Cash payments for operating expenses to be reported on the cash flow statement using the direct method would be:

Question

Quizplus · Accepted Answer

The cash payments for operating expenses are calculated by adjusting the operating expenses for changes in accrued expenses. Since accrued expenses decreased by $47,000, it means that cash payments were higher than the operating expenses reported. Therefore, $563,000 + $47,000 = $610,000.

Operating Expenses Other Than Depreciation for the Year Were $563,000