Question

Naruto, Inc. a business that sells anime accessories, is asking their accountant to prepare a Cash Flow Statement. Naruto is asking the accountant to use the information below:

Net income	$	306,000
Decrease in accounts payable	$	116,400
Increase in inventory	$	25,000
Increase in accounts receivable	$	25,800
Decrease in bonds payable	$	26,200
Loss on sale of a depreciable asset	$	19,600
Depreciation expense	$	43,000
Decrease in income taxes payable	$	13,200

Naruto has informed the accountant to use the indirect method. What is the net cash provided by operating activities??

• $231,600.

• $188,200.

• $205,400.

• $168,600.

Answer 1

Net Income	$       306,000
Add:
Loss on sale of a depreciable asset	$         19,600
Depreciation expense	$         43,000
Less:
Decrease in accounts payable	$       116,400
Increase in inventory	$         25,000
Increase in accounts receivable	$         25,800
Decrease in income taxes payable	$         13,200
net cash provided by operating activities	$       188,200