Determining Net Income from Net Cash Flow from Operating Activities Sanhueza, In

Question

Determining Net Income from Net Cash Flow from Operating Activities Sanhueza, Inc., reported a net cash flow from operating activities of $166,100 on its statement of cash flows for the year ended December 31, 2016 The following information was reported in the Cash Flows from Operating Activities section of the statement of cash flows, using the indirect method: Decrease in income taxes payable Decrease in inventories Depreciation Gain on sale of investments Increase in accounts payable Increase in prepaid expenses Increase in accounts receivable $4,100 10,100 15,600 7,000 2,800 1,700 7,600 Inc., for the year ended December 31, 2016.

Explanation / Answer

Cash Flow From Operating Activities 166100 Add Decrease in income taxes payable 4100 Gain on sale of investments 7000 Increase in prepaid expenses 1700 Increase in accounts receivable 7600 20400 Less Increase in accounts payable 2800 Depreciation 15600 Decrease in inventories 10100 -28500 Net Income 158000

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