ion. Ch. 12 -Quiz Saved 4 Exercise 12-6 Indirect: Cash flow from operations LO P

ID: 2566365 • Letter: I

Question

ion. Ch. 12 -Quiz Saved 4 Exercise 12-6 Indirect: Cash flow from operations LO P2 Salud Company reports the following information. Use the indfirect methodto prepare only the operating activities section of its atement of cash flows for the year ended December 31, 2017. (Amounts to be deducted should be indicated with a minus sign.) Selected 2017 Income Statement Data Selected Year-End 2817 Balance Sheet points Data Net income Depreciation expense 500,e80 Accounts receivable increase $58,809 18,090 8,400 015648) 91,800 Prepaid expenses decrease 23,300 Accounts payable increase Gain on sale of machinery Wages payable decrease 3,500 eBook Cash Sows from operating activities Reference Adjustments to reconcile net income to operating cash Bow

Explanation / Answer

calculation of operating activities from statement of cash flows for the year ended 31st, dec, 2017

Cash flows from operating activities

Net income

$500,000

Adjustments to reconcile net income to operating cash flow

Depreciation

$91,000

Accounts receivable increase

-50,000

Prepaid expense decrease

18,000

Accounts payable increase

8,400

Wages payable decrease

-3,500

Gain on sale of machinery

-23,300

40,600

Net cash provided by operating activities

$540,600