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Question
A corporation prepares its statement of cash flows using the indirect method to report operating activities. Net income for the 2014 fiscal year was $634,000. Depreciation and amortization expense of $60,000 and $30,000 respectively were included with operating expenses in the income statement. The following information describes the changes in current assets and liabilities other than cash:
| Decrease in accounts receivable | $ | 22,000 |
| Increase in inventories | 9,400 | |
| Increase prepaid expenses | 8,900 | |
| Increase in salaries payable | 10,400 | |
| Decrease in income taxes payable | 14,400 | |
Determine the net cash flow provided (used) by operating activities.
A. ($692,500)
B. $692,500
C. $723,700
D. ($536,300)
E. ($723,700)
Answer
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