Question 1. Using the selected data below, calculate the net cash provided by op
ID: 2420403 • Letter: Q
Question
Question 1. Using the selected data below, calculate the net cash provided by operating activities:
Net income $240,000
Increase in accounts receivable $15,000
Increase in accounts payable $12,000
Gain on the sale of equipment $8,000
Depreciation expense $18,000
Purchase of new delivery truck $35,000
Question 2. Using the selected data below, calculate the net cash provided or (used) by investing activities:
Net income $180,000
Depreciation expense $16,000
Gain on the sale of equipment $10,000
Cash proceeds on sale of equipment $12,000
Purchase of new delivery truck $35,000
Explanation / Answer
Answer 1
net Income
2,40,000
Gain on the sale of equipment
-15,000
Depreciation expenses
18,000
Increase in account receivable
-15,000
Increase in account payable
12,000
Net Cash from operating activities
2,40,000
Answer 2
Cash proceed on sale of equipment
12000
Purchase of new delevery truck
-35000
Net cash from investing activity
-23000
* in absence of information it is assumed that delevery truck has been purchased in cash.
*It is assumed that the gain on sale of equipment is for the equipment only which is in question and the gain amount is included in cash proceed of $12000.
net Income
2,40,000
Gain on the sale of equipment
-15,000
Depreciation expenses
18,000
Increase in account receivable
-15,000
Increase in account payable
12,000
Net Cash from operating activities
2,40,000
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