Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Pizza International, Inc., reported the following information (in thousands): Operating Activities Net Income $ 112 Depreciation 33,365 Increase in receivables 182 Decrease in inventory 667
Pizza International, Inc., reported the following information (in thousands):
Operating Activities | |||
Net Income | $ | 112 | |
Depreciation | 33,365 | ||
Increase in receivables | 182 | ||
Decrease in inventory | 667 | ||
Increase in prepaid expenses | 676 | ||
Decrease in accounts payable | 8,732 | ||
Increase in accrued liabilities | 731 | ||
Decrease in income taxes payable | 2,745 | ||
Payments on notes payable | 12,703 | ||
Cash paid for equipment | 29,085 | ||
Required:
Based on this information, compute cash flow from operating activities using the indirect method.
What was the primary reason that Pizza International was able to report large positive cash flow from operations despite nearly having a net loss?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started