Use the Following Information and the Indirect Method to Calculate

question 183

Multiple Choice

Use the following information and the indirect method to calculate the net cash provided or used by operating activities:
$\begin{array}{|l|r|}\hline \text { Net income } & \$ 12,300 \\\hline \text { Depreciation expense } & 12,000 \\\hline \text { Payment on mortgage payable } & 15,000 \\\hline \text { Gain on sale of land } & 7,500 \\\hline \text { Increase in merchandise inventory } & 2,050 \\\hline \text { Increase in accounts payable } & 6,150 \\\hline \text { Proceeds from sale of land } & 8,000\\\hline\end{array}$

• A)$12,700
• B)$13,900
• C)$20,900
• D)$28,400
• E)$35,900

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Definitions:

Liability

Legal responsibility for one's actions or omissions, often involving the obligation to compensate for harm caused.

Possession of Coat

Refers to the act of having physical control over a coat, implying ownership or temporary custody.

Commercial Aircraft

An airplane used for transporting passengers or cargo for profit.

Transfer of Possessions

The act of moving ownership or control of property or assets from one party to another.