Question

Martin Co. had net income of $110,000 during the year. Amortization expense was $15,000. The following information is available Accounts receivable decrease 22,000 Stock sale loss 12,000 Nontrade notes payable decrease 32,000 Prepaid insurance increase 9,000 Accounts payable decrease 17,000 What amount should Martin report as net cash provided by operating activities in its statement of cash flows for the year? A. 118,000 B. 167,000 C. 133,000 D. 101,000

Answer 1

D. 101,000

Step-by-step explanation:

Net Income $110,000

Add back: Non - cash items:

Amortization expenses $15,000

Stock sale loss $12,000 $27,000

Working Capital requirement:

Add: Account receivable decrease $22,000

Less: Prepaid insurance increase ($9,000)

Less: Notes payable decrease ($32,000)

Less: Accounts payable decrease ($17,000) ($36,000)

Cash flow from operating activities $101,000