Calculate net cash flows from operations by adjusting operating profit.
$\begin{array}{llcc}
\text { Profit for the year } &\$ 75000 \
\text { Depreciation } &13000\
\text { Decrease in accounts receivable } &5000\
\text {Decrease in accounts payable } &1000\
\end{array}$

A)$82 000
B)$92 000
C)$56 000
D)$94 000

Question

Calculate net cash flows from operations by adjusting operating profit.
$\begin{array}{llcc}
  \text { Profit for the year } &\$ 75000 \
 \text { Depreciation } &13000\
 \text { Decrease in accounts receivable } &5000\
 \text {Decrease in accounts payable  } &1000\
\end{array}$

A)$82 000
B)$92 000
C)$56 000
D)$94 000

Quizplus · Accepted Answer

To calculate net cash flows from operations, start with the profit for the year ($75,000), add back non-cash expenses like depreciation ($13,000), add the decrease in accounts receivable ($5,000), and subtract the decrease in accounts payable ($1,000). This results in $75,000 + $13,000 + $5,000 - $1,000 = $92,000.

Calculate Net Cash Flows from Operations by Adjusting Operating Profit