Use the indirect method to answer questions The following information is available for Felix Company:
$$\begin{array} { l r l r }
\text { Net income } & \$ 300 & \text { Decrease in plant and equip. } & \$ 40 \
\text { Depreciation expense } & 20 & \text { Increase in deferred tax asset } & 5 \
\text { Gain on sale of assets } & 35 & \text { Decrease in long-term debt } & 50 \
\text { Increase in inventories } & 25 & \text { Decrease in accounts payable } & 15
\end{array}$$
-What is cash flow from operating activities for Felix Company?
A)$240
B)$70
C)$320
D)$250

Question

Use the indirect method to answer questions The following information is available for Felix Company:
$$\begin{array} { l r l r } 
\text { Net income } & \$ 300 & \text { Decrease in plant and equip. } & \$ 40 \
\text { Depreciation expense } & 20 & \text { Increase in deferred tax asset } & 5 \
\text { Gain on sale of assets } & 35 & \text { Decrease in long-term debt } & 50 \
\text { Increase in inventories } & 25 & \text { Decrease in accounts payable } & 15
\end{array}$$
-What is cash flow from operating activities for Felix Company?
A)$240
B)$70
C)$320
D)$250

Quizplus · Accepted Answer

Net income + Depreciation expense + Gain on sale of assets - Increase in inventories - Decrease in accounts payable = Cash flow from operating activities$300 + $20 + $35 - $25 - $15 = $240

Use the Indirect Method to Answer Questions the Following Information