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Five Lakes Transportation (FLT) began 2020 with accounts receivable, inventory, and prepaid expenses totalling $64,000. At the end of the year, FLT had a
Five Lakes Transportation (FLT) began 2020 with accounts receivable, inventory, and prepaid expenses totalling $64,000. At the end of the year, FLT had a total of $76,000 for these current assets. At the beginning of 2020, FLT owed current liabilities of $47,000, and at year-end, current liabilities totalled $42,000. Net income for the year was $80,000. Included in net income were a $8,000 gain on the sale of land and depreciation expense of $6,000. Show how FLT should report cash flows from operating activities for 2020. FLT uses the indirect method. (Use parentheses or a minus sign for numbers to be subtracted or a net decrease in cash.) Cash flows from operating activities: Net income Adjustments to reconcile net income to net cash 80,000 provided by operating activities: Depreciation Gain on sale of land Increase in accounts receivable, inventory, and prepaid expenses Decrease in current liabilities Net cash provided by operating activities 6,000 8,000 -12000 -5000
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