Exhibit 21-3 The Travis Company uses the spreadsheet method for completing the statement of cash flows. The balance sheet accounts and other information related to those accounts are presented below for Travis Company: Additional information related to 2015 activities:
1.Net loss for 2015 was $40,000.
2.Cash dividends of $12,000 were declared and paid in 2015.
3.4,000 shares of common stock were issued to bondholders converting bonds payable into common stock.
4.A long-term investment was sold for $100,000 cash.
5.Equipment costing $100,000 and having accumulated depreciation of $30,000 was sold for $50,000 cash.
-Refer to Exhibit 21-3. Net cash provided (used) in the operating activities section of Travis's 2015 statement of cash flows was
A) $(40,000)
B) $ 50,000
C) $ 52,000
D) $ 56,000

Question

Exhibit 21-3 The Travis Company uses the spreadsheet method for completing the statement of cash flows. The balance sheet accounts and other information related to those accounts are presented below for Travis Company:  Additional information related to 2015 activities: 
1.Net loss for 2015 was $40,000.
2.Cash dividends of $12,000 were declared and paid in 2015.
3.4,000 shares of common stock were issued to bondholders converting bonds payable into common stock.
4.A long-term investment was sold for $100,000 cash.
5.Equipment costing $100,000 and having accumulated depreciation of $30,000 was sold for $50,000 cash.
-Refer to Exhibit 21-3. Net cash provided (used) in the operating activities section of Travis's 2015 statement of cash flows was
A) $(40,000) 
B) $ 50,000 
C) $ 52,000 
D) $ 56,000

Quizplus · Accepted Answer

Net income was $50,000. Depreciation expense was $6,000. The change in accounts receivable was $(2,000). The change in inventory was $4,000. The change in accounts payable was $2,000. Therefore, net cash provided by operating activities was $50,000 + $6,000 - $2,000 + $4,000 - $2,000 = $56,000.

Exhibit 21-3 the Travis Company Uses the Spreadsheet Method for Completing