Question

Amazing Industries began 2018 with accounts​ receivable, inventory, and prepaid expenses totaling $ 45 comma 000 and its total current liabilities totaling $ 32 comma 000. At the end of the​ year, these same current assets totaled $ 44 comma 000​, while its total current liabilities totaled $ 35 comma 000. Net income for the year was $ 89 comma 000. Included in net income were a $ 7 comma 000 loss on the sale of land and depreciation expense of $ 11 comma 000.

Answer 1

Answer: I assume this question is trying to ask us to calculate the operating cash flow of the amazing industries.

Operating cash flow = 111,000

Step-by-step explanation:

I assume this question is trying to ask us to calculate the operating cash flow of the amazing industries.

The formula to find the operating cash flow is

Net income

+ Depreciation

-loss on sale of land

+gain on sale of land

+ decrease in current assets

- increase in current assets

+ increase in current liabilities

- decrease in current liabilities

So in order to calculate

Net income = 89,000

+ Depreciation= 11,000

+ loss on sale of land= 7,000

- gain on sale of land= 0

+decrease in current assets= 1,000 (45,000-44,000)

- increase in current assets =0

+increase in current liabilities= 3,000(35,000-32,000)

-decrease in current liabilities= 0

Operating cash flow = 111,000