A company\'s income statement showed the following: net income, $139,000; deprec

Question

A company's income statement showed the following: net income, $139,000; depreciation expense, $37,500; and gain on sale of plant assets, $21,500. An examination of the company's current assets and current liabilities showed the following changes as a result of operating activities: accounts receivable decreased $10,900; merchandise inventory increased $25,500; prepaid expenses decreased $7,700; accounts payable increased $4,900. Calculate the net cash provided or used by operating activities.
$153,000.
-$157,800.
-$174,500.
$179,000.
$151,000.

Explanation / Answer

Net cash by operating activities : Net income $139,000 Add: Dep exp written back $37,500 Less : Gain on sale of plant assets, ($21,500) Add: Acct Rx decreased $10,900; Less : merchinv increased ($25,500) Add: prepaid exp decreased $7,700; Add : Acct payable increased $4,900 ---------------------------------------- CF from Op activities $153,000

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