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Practice Question 42: In preparing a company's statement of cash flows for the most recent year using the indirect method, the following information is available:

Practice Question 42: In preparing a company's statement of cash flows for the most recent year using the indirect method, the following information is available:

Net income for the year was $ 54,500
Accounts payable decreased by 20,500
Accounts receivable increased by 27,500
Inventories increased by 7,500
Cash dividends paid were 14,500
Depreciation expense was 22,500

Net cash provided by operating activities was:

Multiple Choice

  • $127,500.
  • $72,000.
  • $46,500.
  • $32,500.
  • $21,500

Practice Question 43: Use the following information and the indirect method to calculate the net cash provided or used by operating activities:

Net income $ 85,500
Depreciation expense 12,200
Gain on sale of land 7,700
Increase in merchandise inventory 2,250
Increase in accounts payable 6,350

  • $28,800.

  • $13,000.

  • $94,100.

  • $36,500.

  • 14, 000

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