Question

Brief Exercise 5-13 Bridgeport Company reported 2017 net income of $158,800. During 2017, accounts receivable increased by $18,000 and accounts payable increased by $9,740. Depreciation expense was $47,500. Prepare the cash flows from operating activities section of the statement of cash flows.

Answer 1

Answer:

The amount of cash flow provided by operating activities is $198,040  

Explanation:

The cash flow from operating activities section of the statement of cash flows begins with net income with adjustments made for non-cash expenses as prepared below:

Net income                                                    $158,800

depreciation                                                   $47,500

increase in accounts receivable                     ($18,000)

increase in accounts payable                          $9,740

Cash generated from operating activities       $198,040