Alfredo Inc.reports net income of $230,000 for the year ended December 31.It also reports $87,700 depreciation expense and a $5,000 gain on the sale of equipment.Its comparative balance sheet reveals a $35,500 decrease in accounts receivable,a $15,750 increase in accounts payable,and a $12,500 decrease in wages payable.Calculate the cash provided (used)in operating activities using the indirect method.
A)$376,450.
B)$351,450.
C)$356,450.
D)$319,950.
E)$263,750.

Question

Quizplus · Accepted Answer

The cash provided by operating activities is calculated as follows: Net income ($230,000) + Depreciation expense ($87,700) - Gain on sale of equipment ($5,000) + Decrease in accounts receivable ($35,500) + Increase in accounts payable ($15,750) - Decrease in wages payable ($12,500) = $351,450.