A Company Had Net Income of $252,000

question 144

Multiple Choice

A company had net income of $252,000. Depreciation expense is $26,000. During the year, Accounts Receivable and Inventory increased by $15,000 and $40,000, respectively. Prepaid Expenses and Accounts Payable decreased by $2,000 and $4,000, respectively. There was also a loss on the sale of equipment of $3,000. How much cash was provided by operating activities?

• A) $217,000.
• B) $224,000.
• C) $284,000.
• D) $305,000.

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Definitions:

Net Present Value

A financial metric used to evaluate the profitability of an investment or project by calculating the difference between the present value of cash inflows and outflows over a period of time.

Compound Interest

A method of interest calculation on a loan or deposit that involves both the initial principal and the cumulative interest from earlier periods.

Initial Investment

The initial amount of money invested in a project, property, or business to start operations.

Required Rate

The minimum return an investor expects to achieve when investing in a project or security.