Answer:
net operating cash flows = $218000
Explanation:
given data
net income = $222,000
Beginning inventory = $45,000
ending inventory = $46,000
Beginning Accounts payable = $38,500
ending Accounts payable = $35,500
to find out
net operating cash flows
solution
first we get here Increase in Inventory that is
Increase Inventory = ending inventory - Beginning inventory .......................1
put here value
Increase Inventory = $46,000 - $45,000
Increase Inventory = $1000
and
Decrease in Accounts payable will be here as
Decrease in Accounts payable = Beginning Accounts payable - ending Accounts payable ........................2
put here value we get
Decrease in Accounts payable = $38,500 - $35,500
Decrease in Accounts payable = $3000
so net operating cash flows will be
net operating cash flows = Net Income - Increase Inventory - Decrease in Accounts payable .......................3
put here value
net operating cash flows = $222,000 - $1000 - $3000
net operating cash flows = $218000
