During the current year, a company provides services on account for $120,000. By

Question

During the current year, a company provides services on account for $120,000. By the end of the year, $59,000 of this amount had been received. In addition, cash payments for the year were employees' salaries, $50,000; office supplies, $15,000; and utilities $22,000.

Determine the amount of operating cash flows the company will report in the current year. (Cash outflows should be indicated with a minus sign.)

During the current year, a company provides services on account for $120,000. By the end of the year, $59,000 of this amount had been received. In addition, cash payments for the year were employees' salaries, $50,000; office supplies, $15,000; and utilities $22,000.

Determine the amount of operating cash flows the company will report in the current year. (Cash outflows should be indicated with a minus sign.)

Explanation / Answer

Operating cash flow :

Service revenue (received)                59000

Cash payments:

salaries        (50000)

office supplies (15000)

utilities           (22000)                      (87,000)

Cash provided /(used) by operating activity - ( 28,000)

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