QUESTION 2 Not complete Marked out of 100 Flag question Calc

QUESTION 2 Not complete Marked out of 1.00 ?Flag question Calculating Net Cash Flow from Operating Activities (Indirect Method) Lincoln Company owns no plant assets and reported the following income statement for the current year Sales Cost of Goods Sold $470,000 Wages Expense 110,000 Rent Expense Insurance Expense 15,000 637,000 Net Income $755,000 42,000 $118,000 Additional balance sheet information about the company follows End of Year Accounts Receivable Inventory Prepaid Insurance Accounts Payable Wages Payable 60,000 8,000 22,000 9,000 Beginning of Year $49,000 66,000 7,000 18,000 11,000 Use the information to a. Calculate the net cash flow from operating activities under the indirect method. S 0 Check

Solution

Calculate Cash flow from operating activities :

So answer is $119000

Cash flow from operating activities
Net income		118000
Adjustment to reconcile net income
Increase account receivable	-5000
Decrease inventory	6000
increase prepaid insurance	-1000
Increase account payable	4000
Decrease wages payable	-2000
		2000
Net cash flow from operating activities		120000