Question

Alfredo Inc. reports net income of $248,000 for the year ended December 31. It also reports $95,500 depreciation expense and a $5,900 gain on the sale of equipment. Its comparative balance sheet reveals a $39,100 decrease in accounts receivable, a $17,550 increase in accounts payable, and a $13,700 decrease in wages payable. Calculate the cash provided (used) in operating activities using the indirect method.

Answer 1

Answer:

$380,550

Explanation:

Cash flows from operating activities:

Net income                                                        $248,000

Adjustments to net income:

Depreciation expense $95,500

Gain on sale of equipment ($5,900)

Decrease in accounts rec. $39,100

Increase in accounts pay. $17,550

Decrease in wages payable ($13,700)             $132,550

Net cash flow from operating activities           $380,550