The net income reported on the income statement for the current year was $250,000. Depreciation recorded on fixed assets and amortization of patents for the year were $40,000 and $9,000, respectively. Balances of current asset and current liability accounts at the end and at the beginning of the year are as follows: Cash End Beginning $50,000 $60,000 Accounts Receivable 112,000 108,000 Inventories 105,000 93,000 Prepaid Expenses 4,500 6,500 Accounts Payable 75,000 89,000 What is the amount of cash flows from operating activies reported on the statement of cash flows prepared by the indirect method? a. $271,000 b. $327,000 c. $256,000 d. $279,000

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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The net income reported on the income statement for the current year was $250,000.
Depreciation recorded on fixed assets and amortization of patents for the year were $40,000
and $9,000, respectively.
Balances of current asset and current liability accounts at the end and at the beginning of
the year are as follows:
Cash
End
Beginning
$50,000 $60,000
Accounts Receivable 112,000 108,000
Inventories
105,000 93,000
Prepaid Expenses
4,500
6,500
Accounts Payable
75,000
89,000
What is the amount of cash flows from operating activies reported on the statement of
cash flows prepared by the indirect method?
a. $271,000
b. $327,000
c. $256,000
d. $279,000
Transcribed Image Text:The net income reported on the income statement for the current year was $250,000. Depreciation recorded on fixed assets and amortization of patents for the year were $40,000 and $9,000, respectively. Balances of current asset and current liability accounts at the end and at the beginning of the year are as follows: Cash End Beginning $50,000 $60,000 Accounts Receivable 112,000 108,000 Inventories 105,000 93,000 Prepaid Expenses 4,500 6,500 Accounts Payable 75,000 89,000 What is the amount of cash flows from operating activies reported on the statement of cash flows prepared by the indirect method? a. $271,000 b. $327,000 c. $256,000 d. $279,000
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