Question

Presley, Inc., had the following positive and negative cash flows during the current year. Positive cash flows: Received from customers $ 270,000 Interest and dividends 50,000 Sale of plant assets 360,000 Negative cash flows: Paid to suppliers and employees $ 127,000 Purchase of investments 45,000 Purchase of treasury stock 40,000 Determine the amount of cash provided by or used for operating activities by the direct method.

Answer 1

The amount of cash provided by operating activities is $143,000

Step-by-step explanation:

Cash Flow from operating activities cash generated from to day to day activities of the business. All the cash flows needed to operate the business smoothly.

Cash flows from operating activities

Received from customers $270,000

Paid to suppliers and employees ($127,000)

Cash Provided By operating activities $143,000

Following cash flows relate from the investing and financing activities

Sale of plant assets 360,000

Purchase of investments 45,000

Interest and dividends 50,000

Purchase of treasury stock 40,000