The comparative balance sheets for Crane Company show these changes in noncash current asset accounts: accounts receivable decre

Question

2 years ago

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The comparative balance sheets for Crane Company show these changes in noncash current asset accounts: accounts receivable decre

ased $67,000, prepaid expenses increased $15,000, and inventories increased $27,000. Compute net cash provided by operating activities using the indirect method, assuming that net income is $173,000. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).)

Business

1 answer:

Nastasia [14] · Answer 1 · 2023-02-13T02:47:19+03:00

The Cash flows from operating activities is $148,000.

Statement of cash flow (Indirect method)

Cash-flow from Operating activities

Particulars Amount Amount

Net Income $173,000

Adjustments to reconcile net income

Add: Accounts receivable decreased $67,000

Less: Prepaid expenses increased ($15,000)

Inventories increased ($27,000) $25,000

Cash flows from operating activities $148,000

Therefore, the Cash flows from operating activities is $148,000.