Question

Yellow Company reported net income of $520,000 for the year ended 12/31/21. Included in the computation of net income were: depreciation expense, $85,000; amortization of a patent, $40,000; income from an investment in common stock of XYZ Inc., accounted for under the equity method, $62,000; and amortization of a bond discount, $17,000. Yellow also paid an $60,000 dividend during the year. The net cash provided (used) by operating activities would be reported at ______

Answer 1

Yellow Company
Cash flow from operating activities
Net income	520,000
Add: Adjustments to reconcile net income to net cash provided by operating activities
Depreciation expense	85,000
Amortization of patent	40,000
Net cash flow from Operating Activities	$645,000

The net cash provided (used) by operating activities would be reported at $645,000.

Rest of the amount given is not related to the operating activities, hence ignored.

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