The net income reported on the income statement for the current year was $259,87

Question

The net income reported on the income statement for the current year was $259,875. Depreciation recorded on fixed assets and amortization of patents for the year were $38,045 and $11,977, respectively. Balances of current asset and current liability accounts at the end and at the beginning of the year are as follows: End Beginning Cash $36,699 $67,667 Accounts receivable $120,470 $107,736 Inventories $112,019 $94,949 Prepaid expenses $2,183 $6,040 Accounts payable (merchandise creditors) $50,943 $74,308 What is the amount of cash flows from operating activities reported on the statement of cash flows prepared by the indirect method? Select the correct answer. $332,783 $280,093 $236,031 $260,585

Explanation / Answer

DETAILS AMOUNT AMOUNT NET INCOME $259875 ADD DEPERICATION ON FIXED ASSET $38045 ADD AMORTIZATION ON PATENT $11977 LESS INCEREASE IN ACCOUNTS RECEIVABLE ($12734) LESS INCEREASE IN INVENTORIES ($17070) ADD DECEREASE IN PREPAID EXPENSES $3857 LESS DECEREASE IN ACCOUNTS PAYABLE ($23365) $710 CASH FLOW FROM OPERATING ACTIVITY $260585

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