Zale Corporation’s accumulated depreciation–equipment increased by $8000, while

Question

Zale Corporation’s accumulated depreciation–equipment increased by $8000, while patents decreased by$1,800 between balanced sheet dates. There were no purchasesor sales of depreciable or intangible assets during theyear. In addition, the income statement showed a gain of$12,500 from the sale of land. Reconcile a net income of$12,500 from the sale of land. Reconcile a net income $125,000to net cash flow from operating activities. Zale Corporation’s accumulated depreciation–equipment increased by $8000, while patents decreased by$1,800 between balanced sheet dates. There were no purchasesor sales of depreciable or intangible assets during theyear. In addition, the income statement showed a gain of$12,500 from the sale of land. Reconcile a net income of$12,500 from the sale of land. Reconcile a net income $125,000to net cash flow from operating activities.

Explanation / Answer

Cash flow from operating activities NetIncome                                                125,000 Adjustments +Depreciation                          1,800 - Gain from sale of land        (12,500)                                                                                              114,300

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