Avatar Company uses the indirect method to prepare its statement of cash flows. Please refer to the following information for the year 2014.
$\begin{array}{llr}
\text {- Net cash flows from operating activities: } & \text { $ \$ 32,000 $ positive}\
\text { - Net cash flows from operating activities: } & \text { $ \$ 38,000 $ negative}\
\text {- Net cash flows from financing activities: } & \text { $ \$ 9,000 $ positive}
\end{array}$

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If the beginning cash balance is $18,000, what would the ending cash balance be?
A) $21,000
B) $18,000
C) $3,000
D) $15,000

Question

Avatar Company uses the indirect method to prepare its statement of cash flows. Please refer to the following information for the year 2014.
$\begin{array}{llr}
  \text {- Net cash flows from operating activities:  } & \text { $ \$ 32,000 $ positive}\
 \text { - Net cash flows from operating activities: } & \text { $ \$ 38,000 $ negative}\
 \text {- Net cash flows from financing activities:  } & \text { $ \$ 9,000 $ positive} 
\end{array}$

- 
If the beginning cash balance is $18,000, what would the ending cash balance be?
A) $21,000
B) $18,000
C) $3,000
D) $15,000

Quizplus · Accepted Answer

The ending cash balance is calculated by adding the beginning cash balance to the net cash flows from operating activities and net cash flows from financing activities. In this case, the beginning cash balance is $18,000, the net cash flows from operating activities are $32,000, and the net cash flows from financing activities are $9,000. Therefore, the ending cash balance is $18,000 + $32,000 + $9,000 = $59,000.

Avatar Company Uses the Indirect Method to Prepare Its Statement