Question

Marigold Corp. reported net income of $472000 for the year ended 12/31/21. Included in the computation of net income were: depreciation expense, $59200; amortization of a patent, $32000; income from an investment in common stock of Ivanhoe Company, accounted for under the equity method, $48300; and amortization of a bond discount, $12100. Marigold also paid an $80300 dividend during the year. The net cash provided by operating activities would be reported at

Answer 1

The net cash provided by operating activities for Marigold Corp. would be reported at a value of $560,200.

To calculate the net cash provided by operating activities, we need to consider the adjustments to net income. Finally, we subtract the dividend paid of $80,300, as dividends are considered a financing activity and not included in operating activities.

Putting it all together, the calculation is as follows:

Net cash provided by operating activities = Net income + Depreciation expense + Amortization of a patent - Income from equity method investment + Amortization of bond discount - Dividends paid

= $472,000 + $59,200 + $32,000 - $48,300 + $12,100 - $80,300

= $560,200.

Therefore, the net cash provided by operating activities for Marigold Corp. would be reported at a value of $560,200.