a $280,000. For 2017, depreciation on Compus y operating activities under the in

Question

a $280,000. For 2017, depreciation on Compus y operating activities under the indirect method. indiress e comparative balance sheets for Montalvo Company show these changes in Com y incurred a loss on disposal of plant assets of E17- 80 7 noncash current increase $28,000set a BE17-6 accounts receivable decrease $80,000, prepaid expenses $28,000, and inventories increase $30,000. Compute net cash provided by operat s using the indirect method assuming that net income is $300,000. E1 7-7 The T-accounts for Equipment nd

Explanation / Answer

net cash from operating activities:

note: an increase in a non cash current asset must be decreased from net income.

a decrease in a non cash current asset must be added to net income to arrive at the net cash provided by operating activities.

Net income $300,000 Add: decrease in accounts receivable $80,000 less: prepaid increase ($28,000) less: inventories increase ($30,000) net cash provided by operating activities $322,000

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