Question

Bruce Company reported net income for 2018 of S100,000. The company reported depreciation expense of $17,500 and amortization of $5,000. The company also reported a loss on the sale of equipment of $2,500. Based only on this information, the company would report cash flow from operating activities of Multiple Choice

A. $117,500.
B. $120,000
C. $127,500.
D. $125,000.

Answer 1

cash flow from operating activities = $125,000

so correct option is D. $125,000

Step-by-step explanation:

given data

net income = S100,000

depreciation expense = $17,500

amortization = $5,000

sale of equipment = $2,500

to find out

cash flow from operating activities

solution

we get here cash flow from operating activities that is express as

cash flow from operating activities = Net income + Depreciation expense + Amortization expense + sale of equipment ........................1

put here value we get

cash flow from operating activities = $100,000 + $17,500 + $5,000 + $2,500

cash flow from operating activities = $125,000

so correct option is D. $125,000