A Corporation Prepares Its Statement of Cash Flows Using the Indirect

question 122

Multiple Choice

A corporation prepares its statement of cash flows using the indirect method to report operating activities.Net income for the 2014 fiscal year was $634,000.Depreciation and amortization expense of $60,000 and $30,000 respectively were included with operating expenses in the income statement.The following information describes the changes in current assets and liabilities other than cash: $\begin{array}{lr}\text {Decrease in accounts receivable } & \$ 22,000\\\text {Increase in inventories } & 9,400\\\text {Increase prepaid expenses } &8,900\\\text {Increase in salaries payable } & 10,400\\\text {Decrease in income taxes payable } & 14,400\\\end{array}$
Determine the net cash flow provided (used) by operating activities.

• A)($692,500)
• B)$692,500
• C)$723,700
• D)($536,300)
• E)($723,700)

---

Definitions:

Alopecia

A condition characterized by partial or complete hair loss on the scalp or other parts of the body.

Dandruff

A common scalp condition characterized by flaking of the skin on the scalp.

Plastic Lenses

Lenses made of a plastic material, used in glasses to correct vision or protect the eyes.

Storage Solution

A liquid or environment designed to preserve the integrity of biological samples or chemicals.