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The net income reported on the income statement for the current year was $100,000. Depreciation recorded on plant assets was $25,000.
Accounts receivable and inventories decreased by $5,000 and $15,000,respectively.
Prepaid expenses and accounts payable increased by $500 and $4,000, respectively.

Using the indirect method, how much would be reported for net cash flows from operating activities in the statement of cash flows?
a. $130,000
b. $148,500
c. $141,500
d. $98,500

Respuesta :

amanarsalan

Answer:

b. $148,500

Explanation:

CASH FLOWS FROM OPERATING ACTIVITIES  $

Net Income     100,000

Adjustments to reconcile net income to      

net cash provided by operating activities:      

Depreciation on Fixed Assets    25,000  

(Increase) Decrease in Current Assets:      

Accounts Receivables    5,000

Inventory      15,000

Prepaid Expenses     (500)

Increase (Decrease) in Current Liabilities:    

Accounts Payable     4,000

NET CASH PROVIDED BY OPERATING ACTIVITIES 148,500