Hayward Corporation had net sales of $610,000 and cost of goods sold of $360,000 for the just completed year. Shown below are the beginning and ending balances for the year of various accounts: The company prepares its statement of cash flows using the direct method.On its statement of cash flows, what amount should Howard show for its cost of goods sold adjusted to a cash basis (i.e., cash paid to suppliers)?
A) $345,000
B) $366,000
C) $379,000
D) $373,000

Question

Hayward Corporation had net sales of $610,000 and cost of goods sold of $360,000 for the just completed year. Shown below are the beginning and ending balances for the year of various accounts:  The company prepares its statement of cash flows using the direct method.On its statement of cash flows, what amount should Howard show for its cost of goods sold adjusted to a cash basis (i.e., cash paid to suppliers)?
A) $345,000 
B) $366,000 
C) $379,000 
D) $373,000

Quizplus · Accepted Answer

To find the cash paid to suppliers (i.e. cost of goods sold adjusted to a cash basis), we need to use the following formula: Cash paid to suppliers = Cost of goods sold + Beginning inventory - Ending inventory. 
Using the information given, we can calculate:
Cash paid to suppliers = 360,000 + 45,000 - 26,000 = $379,000. 
Therefore, the correct answer is C.

Hayward Corporation Had Net Sales of $610,000 and Cost of Goods