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Rufina [12.5K]
3 years ago
15

Skysong, Inc. reported net income of $194,500 for 2020. Skysong also reported depreciation expense of $47,500 and a loss of $6,2

00 on the disposal of plant assets. The comparative balance sheet shows a decrease in accounts receivable of $18,200 for the year, a $20,200 increase in accounts payable, and a $5,000 decrease in prepaid expenses. Prepare the operating activities section of the statement of cash flows for 2020. Use the indirect method.
Business
1 answer:
Elza [17]3 years ago
8 0

Answer:

Net cashflow from operating activities =$271,400

Explanation:

<em>The cash flow statement is a financial statement that provides information about the sources and the usage of cash during a particular accounting period usually a year.</em>

It provides the cash inflow and outflows under three (3 ) categories of activities operating investing, financing.

The net operating activities section of the  cash flow is prepared below:

                                                                            $  

Net income                                                      194,500

Add Depreciation expense                             47,500

Add Loss on disposal                                       6,200

Add Decrease in account receivable             18,200

Add Increase in accounts payable                <u>  5,000</u>

Net cashflow from operating activities      <u>271,400  </u>

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