The following information has been provided to you by your controller: $$\begin{array} { l r }
\text { Net income } & \$ 100,000 \
\text { Decrease in accounts payable } & \$ 38,000 \
\text { Decrease in inventory } & \$ 7,500 \
\text { Increase in accounts receivable } & \$ 8,000 \
\text { Decrease in bonds payable } & \$ 75,000 \
\text { Amortization of bond discount } & \$ 9,400 \
\text { Depreciation expense } & \$ 20,000 \
\text { Increase in income taxes payable } & \$ 6,000
\end{array}$$
What is the net cash flow from operating activities?
A)$96,900
B)$97,900
C)$112,900
D)$94,100

Question

The following information has been provided to you by your controller: $$\begin{array} { l r } 
\text { Net income } & \$ 100,000 \
\text { Decrease in accounts payable } & \$ 38,000 \
\text { Decrease in inventory } & \$ 7,500 \
\text { Increase in accounts receivable } & \$ 8,000 \
\text { Decrease in bonds payable } & \$ 75,000 \
\text { Amortization of bond discount } & \$ 9,400 \
\text { Depreciation expense } & \$ 20,000 \
\text { Increase in income taxes payable } & \$ 6,000
\end{array}$$
What is the net cash flow from operating activities?
A)$96,900
B)$97,900
C)$112,900
D)$94,100

Quizplus · Accepted Answer

Net income + Depreciation expense + Amortization of bond discount - Decrease in accounts payable - Decrease in inventory + Increase in accounts receivable + Decrease in bonds payable + Increase in income taxes payable = Net cash flow from operating activities$100,000 + $20,000 + $9,400 - $38,000 - $7,500 + $8,000 - $75,000 + $6,000 = $96,900

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