Martin, Inc

question 20

Essay

Martin, Inc.'s, income statement is shown below. Based on this income statement and the other information provided, calculate the net cash provided by operations using the indirect method.
Additional information:
$$\begin{array} { | l | r | } \hline \text { Increase in accounts receivable } & \$ 4,000 \\\hline \text { Increase in accounts payable } & 16,000 \\\hline \text { Increase in income taxes payable } & { 3 0 0 } \\\hline \text { Decrease in prepaid expenses } & 10,000 \\\hline \text { Decrease in merchardise inveritory } & 14,000 \\\hline \text { Decrease in long-tem notes payable } & { 2 0 , 0 0 0 } \\\hline\end{array}$$

---

Definitions:

Demand Curve

A graphical representation of the relationship between the price of a good or service and the quantity of that good or service that consumers are willing and able to purchase.

Income Effect

A change in the demand for goods or services attributed to a change in consumers’ income.

Substitution Effect

An economic principle describing how changes in the price of goods lead consumers to replace these goods with cheaper alternatives, affecting the quantity demanded.

Indifference Curve

An illustration representing a consumer's preference equilibrium between two products, indicating no preference difference.