Question

In Coronado Company, net income is $284600. If accounts receivable increased $139100 and accounts payable decreased $39900, net cash provided by operating activities using the indirect method is __________.

Answer 1

$105,600

Step-by-step explanation:

Operating activities: It includes those transactions which affect the working capital after net income. The increase in current assets and a decrease in current liabilities would be deducted whereas the decrease in current assets and an increase in current liabilities would be added.

These changes in working capital would be adjusted. Moreover, the depreciation expense is added to the net income

The computation of the net cash provided is shown below:

= Net income - increase in account receivable - decrease in account payable

= $284,600 - $139,100 - $39,900

= $105,600