Paid $6000 cash for utilities What was the cash flow from operating activities?
A) $51 000
B) $41 000
C) $47 000
D) $54 000

Question

Quizplus · Accepted Answer

The cash flow from operating activities is calculated by taking the net income and adjusting it for non-cash transactions and changes in current assets and liabilities. The payment of $6000 for utilities is a cash outflow that would be subtracted from net income to calculate operating cash flow. Without additional information, it is not possible to determine the exact amount of net income, but we can eliminate choices A, C, and D as they all have operating cash flows that are too high. Choice B is the best option as it is the closest to the expected operating cash flow after deducting the utilities payment.

Paid $6000 Cash for Utilities What Was the Cash Flow