Huluduey Corporation\'s comparative balance sheet for current assets and liabilt

Question

Huluduey Corporation's comparative balance sheet for current assets and liabilties was as follows Dec. 31, Year 2 Dec. 31, Year 1 Accounts receivable Inventory Accounts payable Dividends payable $32,350 18,640 15,940 51,460 $27,670 15,960 14,650 48,000 Adjust net income of $213,480 for changes in operating assets and liabilities to arrive at net cash flow from operating activities. Refer to the Amount Descriptions list provided for the exact wording of the answer choices for text entries. Use the minus sign to indicate cash outflows, cash payments, decreases in cash and for any adjustments, if required Amount Descriptions Cash paid for dividends Decrease in accounts payable Decrease in accounts receivable Decrease in dividends payable Decrease in inventory Increase in accounts payable hcrease in accounts receivable Increase in dividends payabl hcrease in inventory Net cash flow from operating activties Adjust net income of S213,480 for changes in operating assets and liabilities to arrive at net cesh flow from ogerating activities. Refer to the Amount Descriptions list provided for the exact wording of the answer choices for text entries. Use the minus sign to indicate cash outflows, cash payments, decreases in cash and for any adjustments, if required 1 Net income 2 Adjustments to reconcile net income to net cash flow from operating activities: 3 Changes in current operating assets and Liabilities: Increase in accounts receivable 5Increase in inventary 6 Increase in accounts payable 7Net cash flow from operating (4,680.00) (2,680.00) 1,290.00 $207,410.00 activities

Explanation / Answer

Cashflows from operating activities

Net Income

$213,480

Adjustments to reconcile net income to net cash flow from operating activities:

Changes in current operating assets and liabilities:

Increase in Accounts receivables (27,670-32,350)

($4,680)

Increase in inventory (15,960-18640)

($2,680)

Increase in accounts payables (15,940-14,650)

$1,290

Net cash flow from operating activities

$207,410

Note: even though dividends payable current liability it is not an operating activity. Hence not considered for calculation

Cashflows from operating activities

Net Income

$213,480

Adjustments to reconcile net income to net cash flow from operating activities:

Changes in current operating assets and liabilities:

Increase in Accounts receivables (27,670-32,350)

($4,680)

Increase in inventory (15,960-18640)

($2,680)

Increase in accounts payables (15,940-14,650)

$1,290

Net cash flow from operating activities

$207,410

Note: even though dividends payable current liability it is not an operating activity. Hence not considered for calculation

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