Question

The current sections of Sage Hill Inc.’s balance sheets at December 31, 2021 and 2022, are presented here. Sage Hill Inc.’s net income for 2022 was $175,950. Depreciation expense was $31,050.

		2022		2021
Current assets
Cash		$120,750		$ 113,850
Accounts receivable		92,000		102,350
Inventory		193,200		197,800
Prepaid expenses		31,050		25,300
Total current assets		$437,000		$439,300
Current liabilities
Accrued expenses payable		$ 17,250		$ 5,750
Accounts payable		97,750		105,800
Total current liabilities		$115,000		$ 111,550

Answer 1

Answer-

SAGE HILL INC.'S
STATEMENT OF CASH FLOWS PARTIAL (USING INDIRECT METHOD)
FOR THE YEAR ENDED 31 DECEMBER,2022
Particulars		Amount
		$
Cash flow from operating activities
Net loss		175950
Adjustments to reconcile net income to net cash provided by operating activities
Adjustment for non cash effects
Depreciation		31050
Change in operating assets & liabilities
Decrease in accounts receivable		10350
Decrease in inventory		4600
Decrease in accounts payable		-8050
Increase in prepaid expenses		-5750
Increase in accrued expenses payable		11500
Net cash flow from operating activities		219650