Question

Ophelia Org. uses the indirect method to determine net cash provided by operating activities. During 2017, Ophelia experienced a decrease in Accounts Receivable of $10,000, a decrease in Accounts Payable of $15,000, and Amortization Expense of $6,000. What should be reported as the net cash provided by operating activities if net income was reported at $100,000 and dividend payments were $25,000

Answer 1

The net cash provided by Ophelia Org.'s operating activities is $131,000.

Data and Calculations:

Decrease in Accounts Receivable = $10,000

Decrease in Accounts Payable = $15,000

Amortization Expense $6,000

Net income = $100,000

Dividend payments = $25,000

Net Cash from Operating Activities:

Net income =                                   $100,000

Add: Amortization Expense               $6,000

Decrease in Accounts Receivable  $10,000

Decrease in Accounts Payable       $15,000

Cash provided by operations =     $131,000

Thus, the net cash provided by Ophelia Org.'s operating activities is $131,000.

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