Alvez reports net income of $347,500 for the year ended December 31. It also rep

ID: 2468878 • Letter: A

Question

Alvez reports net income of $347,500 for the year ended December 31. It also reports $115,800 depreciation expense and a $12,550 loss on the sale of equipment. Its comparative balance sheet reveals a $50,400 increase in accounts receivable, a $12,750 decrease in prepaid expenses, a $19,450 increase in accounts payable, a $15,900 decrease in wages payable, a $93,700 increase in equipment, and a $125,500 decrease in notes payable. Calculate the net increase in cash for the year.

$316,250.

$441,750.

$235,100.

$222,550.

$348,050.

Explanation / Answer

Net income $347,500

Add: Depreciation expense 115,800

Loss on sale of equipment 12,550

Decrease in prepaid expense 12,750

Increase in accounts payable 19,450

Increase in account receivable -50,400

Decrease in wages payable -15,900 94,250

Net cash provided by operating activities 441,750

Investing activities

Purchase of Equipment -93,700

Financing activities

Payment of notes payable -125,500

Net cash increase $222,550

Answer $222,550