Question

Assume net income was $210,000, depreciation expense was $6,200, accounts receivable decreased by $11,500, and accounts payable decreased by $3,000. The amount of cash flows from operating activities is:

a 224,700
b 210,000
c. 208,300
d 216,200

Answer 1

Answer:

Amount of cash flow will be $224700

So option (a) is correct option

Explanation:

We have given net income = $210000

Depreciation expense = $6200

Account receivable is decreased by $11500

And account payable is decreased by $3000

We have to find the amount of cash flow

We know that amount of cash flow is given by

Cash flow = net income + Depreciation expense +amount which is decreased in account receivable - amount which is decreased in account payable

So cash flow = $210000+$6200+$11500-$3000 = $224700

So option (a) is the correct option