Cash Flows from Operating Activities—Indirect MethodStaley Inc. reported the following data:Net income$298,400Depreciation expense59,600Loss on disposal of equipment24,800Increase in accounts receivable13,200Increase in accounts payable11,800Prepare the Cash Flows from Operating Activities section of the statement of cash flows, using the indirect method. Use the minus sign to indicate cash out flows, cash payments, decreases in cash, or any negative adjustments.

The cash flow from operating activities by indirect method starts with net income and adjusts for non cash changesStatement of Cash flows Net Income 298400 Add: Depreciation 59600 Add: Loss on disposal of equipment 24800 Add: Increase in accounts payable 11800 Less: Increase in account receivable -13200 Cash flow provided by operating activities 381400Cash flow from operating activities = $381,400

Answered: Cash Flows from Operating…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

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Cash Flows from Operating Activities—Indirect Method

Staley Inc. reported the following data:

Net income	$298,400
Depreciation expense	59,600
Loss on disposal of equipment	24,800
Increase in accounts receivable	13,200
Increase in accounts payable	11,800

Prepare the Cash Flows from Operating Activities section of the statement of cash flows, using the indirect method. Use the minus sign to indicate cash out flows, cash payments, decreases in cash, or any negative adjustments.

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