Calculate the cash from operating activities using the following information: Profit $142,000 Depreciation $46,000
Accounts receivable increased by $10,000 Accrued expense increased by $12,000 Inventory increased by $14,000
A) $200,000
B) $176,000
C) $165,000
D) $186,000

Question

Quizplus · Accepted Answer

To calculate cash from operating activities, start with the profit and adjust for non-cash and working capital changes. Here, add back depreciation ($46,000) since it's a non-cash expense. Then, adjust for changes in working capital: decrease for accounts receivable increase ($10,000), increase for accrued expenses increase ($12,000), and decrease for inventory increase ($14,000). So, the calculation is $142,000 + $46,000 - $10,000 + $12,000 - $14,000 = $176,000.

Calculate the Cash from Operating Activities Using the Following Information