# Cost of goods sold amounted to $403,000, accounts payable increased by$20,400, and inventories...

Cost of goods sold amounted to $403,000, accounts payable increased by$20,400, and inventories increased by $15,400. How much cash was paid to suppliers? The net book value of buildings increased by$228,000. No buildings were sold, and depreciation expense for the year was $197,000. How much cash was paid to purchase buildings? ## Cash Flow Statement: The cash flow statement shows how the company spent its cash in the different activities of operating, investing and financing. It can be prepared through direct and indirect methods. ## Answer and Explanation: Cost of goods sold amounted to$403,000, accounts payable increased by $20,400, and inventories increased by$15,400. How much cash was paid to suppliers?

Cash Paid to Suppliers = Cost of Goods Sold + Increase in Inventory - Increase in Accounts Payable

Cash Paid to Suppliers = $403,000 +$15,400 - $20,400 Cash Paid to Suppliers =$398,000

Cost of goods sold + increase in inventory represents purchases

The net book value of buildings increased by $228,000. No buildings were sold, and depreciation expense for the year was$197,000. How much cash was paid to purchase buildings?

Cash Paid to Purchase Buildings = Increase in Net Book Value of Buildings + Depreciation Expense

Cash Paid to Purchase Buildings = $228,000 +$197,000

Cash Paid to Purchase Buildings = \$425,000