A Corporation Prepares Its Statement of Cash Flows Using the Indirect

question 39

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:
$$\begin{array} { l r } \text { Decrease in accounts receivable } & \$ 22,000 \\\text { Increase in inventories } & 9,400 \\\text { Increase prepaid expenses } & 8,900 \\\text { Increase in salaries payable } & 10,400 \\& \\\text { Decrease in income taxes payable } & 14,400\end{array}$$
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)

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