Question

A company uses the indirect method to determine its cash flows from operating activities. Use the following information to determine its net cash provided or used by operating activities. Net income $15,200 Depreciation expense 10,000 Cash payment on note payable 8,000 Gain on sale of land 3,000 Increase in inventory 1,500 Increase in accounts payable 2,850

Answer 1

Answer:

The net cash flows from operating activities is $15,550.

Explanation:

A company

Statement of cash flows (extract)

Net income                                                      $15,200

Add Depreciation expense                              10,000

       Increase in accounts payable                    2,850

Less Gain on sale of land                                 (3,000)

        Increase in inventory                                (1,500)

        Cash payment on note payable              (8,000)  

Net cash flows from operating activities     $15,550