Question

The data given below are from the accounting records of the Kuhn Corporation:

Net Income (accrual basis) $61,000
Depreciation Expense $17,000
Decrease in Accounts Payable $3,300
Decrease in Inventory $3,800
Increase in Bonds Payable $18,000
Sale of Common Stock for cash $31,600
Increase in Accounts Receivable $6,100

Based on this information, the net cash provided by (used in) operating activities using the indirect method would be:________

Answer 1

Answer:

$72,400

Explanation:

The preparation of the Cash Flows from Operating Activities - Indirect Method is presented below:

Cash flow from Operating activities - Indirect method

Net income $61,000

Adjustment made:

Add : Depreciation expense $17,000

Less: Increase in accounts receivable -$6,100

Add: Decrease in inventory $3,800

Less: Decrease in accounts payable -$3,300

Total of Adjustments $11,400

Net Cash flow provided Operating activities $72,400

The items in minus sign reflects the cash outflow and the items in plus sign shows the cash inflow