Question

Morbeck Corporation's net income last year was $56,000. The company paid a cash dividend of $31,000 and did not sell or retire any property, plant, and equipment last year. Changes in selected balance sheet accounts for the year appear below: Increases (Decreases) Asset and Contra-Asset Accounts: Accounts receivable ($8,000) Inventory ($6,000) Prepaid expenses $12,000 Accumulated depreciation $23,000 Liability Accounts: Accounts payable ($10,000) Accrued liabilities $7,000 Income taxes payable $5,000 Bonds payable $40,000 Based solely on this information, the net cash provided by operating activities under the indirect method on the statement of cash flows would be:

Answer 1

Cash flow from operating activities :

Net income	56000
Adjustment to reconcile net income
Depreciation expense	23000
Decrease account receivable	8000
Decrease inventory	6000
Increase prepaid expense	-12000
Decrease account payable	-10000
Increase accured liabiltiy	7000
increase income tax payable	5000
Net cash flow from operating activities	83000

Based solely on this information, the net cash provided by operating activities under the indirect method on the statement of cash flows would be: $83000