Extracts from Rainer's statements of financial position at 31 March 20X6 and 20X5 are as follows: Operating profit for the year ended 31 March 20X6 was £11 200 and depreciation charged for the year was £8844.
What was the net cash inflow from operating activities for inclusion in the statement of cash flows for the year ended 31 March 20X6?
A)£22 937
B)£5249
C)£17 151
D)£18 041

Question

Extracts from Rainer's statements of financial position at 31 March 20X6 and 20X5 are as follows:  Operating profit for the year ended 31 March 20X6 was £11 200 and depreciation charged for the year was £8844.
What was the net cash inflow from operating activities for inclusion in the statement of cash flows for the year ended 31 March 20X6?
A)£22 937 
B)£5249 
C)£17 151 
D)£18 041

Quizplus · Accepted Answer

The net cash inflow from operating activities can be calculated using the formula: operating profit + depreciation - increase in receivables + decrease in payables. We are not given information about changes in receivables or payables, so we cannot calculate those components. Therefore, the net cash inflow from operating activities for the year ended 31 March 20X6 is calculated as follows: £11 200 + £8 844 = £20 044.

Extracts from Rainer's Statements of Financial Position at 31 March