Question

Darwin Company, a manufacturer, has provided the following information pertaining to its recent year of operation: • Net income $300,000 • Accounts receivable decreased $28,000 • Prepaid insurance increased $9,000 • Depreciation expense was $25,000 • Loss on sale of a building was $12,000 • Wages payable decreased $14,000 • Unearned revenue increased $21,000 Using the indirect method, how much was Darwin's net cash provided by operating activities?

Answer 1

Answer:

$363,000

Explanation:

The computation of net cash provided by operating activities is shown below:-

Net Income                                               $300,000

Add: Depreciation                                     $25,000

Add: Loss on sale of Building                   $12,000

Add: Decrease in Accounts Receivable  $28,000

Add: Unearned revenue increased           $21,000

Less: Increase in prepaid expenses          ($9,000)

Less: Wages payable decreased               ($14,000)

Total Cash Flow from Operating Activities $363,000