Question

In 2008, Lower Case Productions had cash flows from investing activities of $85,000 and cash flows from financing activities of $93,000. The balance in the firm's cash account was $94,000 at the beginning of 2018 and $72,000 at the end of the year. What was Lower Case's cash flow from operations for 2018

Answer 1

Answer:

-$200,000

Explanation:

The cash  balance in the cash account at the end of the year is shown by the formula below:

Cash balance at the end of the year=cash flows from operations+cash flow investing activities+cash flows from financing activities+beginning cash balance

Cash balance at the end of the year=$72,000

cash flows from operations=X

cash flow investing activities=$85,000

cash flows from financing activities= $93,000

beginning cash balance=$94,000

cash flow investing activities+cash flows from financing activities+beginning cash balance=$85,000+$93,000+$94,000=$272,000

$72,000=X+$272,000

The above shows that cash flows from operations is a cash outflow not an inflow

X=$72,000-$272,000=-$200,000