Answer:
The Net cash is 436.000
Explanation:
To get net cash flow using the indirect method we must make adjustments to the net income.
It depends on the account if it is added or subtracted to net income
In this case,
Net income 400.000
Adjustment to reconcile the net income to cash
- Accounts receivable increase (40.000)
+ Depreciation expense 80.000
+ Prepaid expenses decrease 12.000
- Gain on sale of machinery (20.000)
+ Accounts payable increase 6.000
- Wages payable decrease (2.000)
Net cash 436.000
