Question
In its second year of business, a company has a net income of $120,000. The following table provides year end account information. Account Year 1
In its second year of business, a company has a net income of $120,000. The following table provides year end account information.
Account Year 1 Year 2
Accounts payable $5,000 $4,000
Accumulated depreciation $65,000 $85,000
Prepaid expenses $20,000 $15,000
Fixed assets $250,000 $255,000
The company uses the indirect method in preparation of a statement of cash flows for Year 2.
How much should the company report as net cash provided by operating activities?
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Financial Accounting Fundamentals
Authors: John Wild, Ken Shaw, Barbara Chiappetta
6th edition
1259726916, 978-1259726910
