Revenue on account amounted to $9,000. Cash collections of accounts receivable amounted to $8,100. Cash paid for expenses was $7,500. The amount of employee salaries accrued at the end of the year was $900. What is the net cash flow from operating activities for the year?
A) $900
B) $600
C) $1,500
D) $8,700

Question

Quizplus · Accepted Answer

Net cash flow from operating activities is calculated by considering cash inflows and outflows related to core business operations. Here, cash collections of $8,100 (inflow) and cash paid for expenses of $7,500 (outflow) are relevant, giving a net cash flow of $600 ($8,100 - $7,500). Revenue on account and accrued salaries do not affect cash flow directly.

Revenue on Account Amounted to $9,000