Question

In preparing a company's statement of cash flows using the indirect method, the following information is available: Net income $ 52,000 Accounts payable decreased by 18,000 Accounts receivable increased by 25,000 Inventories increased by 5,000 Depreciation expense 30,000 Net cash provided by operating activities was:

Answer 1

Answer:

Cash flows from operating activities:

Net income                                                                          $52,000

Adjustments to net income:

• Depreciation expense $30,000
• Accounts receivable increased by ($25,000)
• Inventories increased by ($5,000)
• Accounts payable decreased by ($18,000)             ($18,000)

Net cash flow provided by operating activities                $34,000