Question

Bonita Industries reported net income of $58000 for the year ended December 31, 2021 Included in net income were depreciation expense of $8800 and a gain on sale of equipment of $2200. Each of the following accounts increased during 2021: Accounts receivable $2800 Inventory $4100 Prepaid rent $7400 Available-for-sale securities $1100 Accounts payable $4800 What is the amount of cash provided by operating activities for Bonita Industries for the year ended December 31, 2021?

Answer 1

the Cash provided by operating activities is $55,100

Step-by-step explanation:

The computation of the cash provided by operating activities is shown below;

Cash provided by operating activities:

= Net income + Depreciation - Gain on sale or asset - Increase in accounts receivable - Increase in inventory - Increase in prepaid rent + Increase in accounts payable

= $58,000 + $8,800 - $2,200 - $2,800 - $4,100 - $7,400 + $4,800

= $55,100

Hence, the Cash provided by operating activities is $55,100