Financial Accounting: Tools for Business Decision Making, 8th Edition
Financial Accounting: Tools for Business Decision Making, 8th Edition
8th Edition
ISBN: 9781118953808
Author: Paul D. Kimmel, Jerry J. Weygandt, Donald E. Kieso
Publisher: WILEY
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Chapter 12, Problem 12.2ADIE
To determine

Cash flows from operating activities: These refer to the cash received or cash paid in day-to-day operating activities of a company.

Indirect method: Under this method, the following amounts are to be adjusted from the Net Income to calculate the net cash provided from operating activities.

  • Deduct increase in current assets.
  • Deduct decrease in current liabilities.
  • Add decrease in current assets.
  • Add the increase in current liability.
  • Add depreciation expense and amortization expense.
  • Add loss on sale of plant assets.
  • Less gain on sale of plant assets.

To Compute: Net cash provided by operating activities using indirect method.

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Financial Accounting: Tools for Business Decision Making, 8th Edition

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