A company had net income of $210,000. Depreciation expense is $27,000. During the year, Accounts Receivable and Inventory increa

Question

3 years ago

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A company had net income of $210,000. Depreciation expense is $27,000. During the year, Accounts Receivable and Inventory increa

sed $17,000 and $42,000, respectively. Prepaid Expenses and Accounts Payable decreased $5,000 and $6,000, respectively. There was also a loss on the sale of equipment of $2,000. Cash provided by operating activities was $Placeholder for missing word.How much cash was provided by operating activities?
a. $179000
b. $241000
c. $271000
d. $175000

Business

1 answer:

Sergio039 [100] · Answer 1 · 2022-05-25T22:56:50+03:00

Answer:

a. $179000

Explanation:

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

Net Income $2,10,000

Add : Depreciation expense $27,000

Add : Loss on sale of equipment $2,000

Add : Decrese in prepaid expenses $5,000

Less : Decrease in accounts payable $6,000

Less : Increse in accounts receivable $17,000

Less :Increase in inventory $42,000

Cash provided by operating activities $179,000