2) Castine reports net income of $305,000 for the year ended December 31, Year 2

Question

2) Castine reports net income of $305,000 for the year ended December 31, Year 2. It also reports $93,700 depreciation expense and a $10,000 loss on the sale of equipment. Its comparative balance sheet reveals a $40,200 increase in accounts receivable, a $10,200 decrease in prepaid expenses, a $15,200 increase in accounts payable, a $12,500 decrease in wages payable, a $75,000 increase in equipment, and a $100,000 decrease in notes payable. Calculate the increase in cash for Year 2.

a. $216,400.
b. $281,400.
c. $381,400.
d. $206,400.
e. $406,400.

Explanation / Answer

305000+ 937000 + 10000 - 40200 + 10200 + 15200 - 12500 - 75000 - 100000 = Answer is d : $ 206400 If you need any explanation more please just comment and i will reply back asap :)

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