Answer:
Amount in $
Net income 50,000
Depreciation expense 7,000
Increase in inventory (1,500)
Decrease in salaries payable (800)
Decrease in accounts receivable 2,000
Amortization of patent 500
Amortization of premium on bonds 1,000
Increase in accounts payable 4,000
Net cash flow from operating activities 62,200
Step-by-step explanation:
Net income = $ 50,000 (operating activity)
Depreciation expense = $7,000 (operating activity)
Increase in inventory = $1,500 (operating activity)
Decrease in salaries payable = $800 (operating activity)
Decrease in accounts receivable = $2,000 (operating activity)
Amortization of patent = $500 (operating activity)
Amortization of premium on bonds = $1,000 (operating activity)
Increase in accounts payable = $4,000 (operating activity)
Cash dividends = $12,000 (financing activity)
Reconciliation of net income to net cash flows from operating activities
Amount in $
Net income 50,000
Depreciation expense 7,000
Increase in inventory (1,500)
Decrease in salaries payable (800)
Decrease in accounts receivable 2,000
Amortization of patent 500
Amortization of premium on bonds 1,000
Increase in accounts payable 4,000
Net cash flow from operating activities 62,200