Question

Cheyenne Corp. reported net income of $196,100 for 2022. Cheyenne also reported depreciation expense of $47,400 and a loss of $5,600 on the disposal of plant assets. The comparative balance sheets show an increase in accounts receivable of $10,900 for the year, a $12,900 increase in accounts payable, and a $3,200 increase in prepaid expenses. Prepare the operating activities section of the statement of cash flows for 2022. Use the indirect method

Answer 1

Particulars Amount

Net Operating Income $ 196,100

Adjustments to reconcile the net to :

Net Cash provided by the operating activities.

Add the depreciation expenses $ 47,400

Add loss on disposal of plant assets $ 5,600

Add increase in the accounts receivable $ 10,900

Add increase in Accounts payable $ 12,900

Add increases in prepaid expenses $ 3,200

$ 80,000

Cash balance at the end $ 276,100