Net Income Reported for the Current Year Was $200,000

question 25

Multiple Choice

Net income reported for the current year was $200,000.Depreciation expense was $35,000.During the year, Accounts Receivable and Inventory increased $18,000 and $26,000, respectively.Prepaid Expenses and Accounts Payable decreased $4,000 and $9,000, respectively.There was also a loss on the sale of equipment of $6,000.Using the indirect method, how much cash was provided by operating activities?

• A)$182,000
• B)$192,000
• C)$210,000
• D)$244,000

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Definitions:

Liability

The state of being responsible or legally obligated to settle a debt or fulfill a contractual agreement; also refers to any form of legal obligation.

Sole Proprietorship

A type of enterprise that is owned and run by one person and in which there is no legal distinction between the owner and the business entity.