Question

Kennedy, Inc. reported the following data:

Net income$184,581

Depreciation expense16,601

Loss on disposal of equipment(9,387)

Gain on sale of building19,680

Increase in accounts receivable10,437

Decrease in accounts payable(2,265)

Prepare the cash flows from operating activities section of the statement of cash flows using the indirect method. Use the minus sign to indicate cash outflows, a decrease in cash, cash payments, or any negative adjustments.

Kennedy, Inc.

Statement of Cash Flow

Cash flows from operating activities:

Net income $

Adjustments to reconcile net income to net cash flow from operating activities:

Depreciation expense

Loss on disposal of equipment

Gain on sale of building

Changes in current operating assets and liabilities:

Increase in accounts payable

Decrease in accounts receivable

Net cash flow from operating activities$

Answer 1

SOLUTION:

Cash flow from operating activities:

Net income	$184581
Adjustments to reconcile net income to net cash flow from operating activities:
Depreciation expense	$16601
Loss on disposal of equipment	$9387
Gain on sale of building	- $19680
Changes in current operating assets and liabilities:
Increase in accounts receivable	- $10437
Decrease in accounts payable	- $2265
Net cash flow from operating activities$	$178187