Question

Suppose Valley Technology has the following results related to cash flows for 2018:

Net Income of $7,100,000
Decrease in Accounts Payable of $200,000
Decrease in Accounts Receivable of $600,000
Depreciation of $1,200,000
Increase in Inventory of $500,000
Other Adjustments from Operating Activities of $500,000

Assuming no other cash flow adjustments than those listed above, create a statement of cash flows with amounts in thousands.

What is the Net Cash Flow from Operating Activities?

Please specify your answer in the same units as the statement of cash flows.

Answer 1

Net Cash Flow from Operating Activities = $8,700,000

Explanation

Cash Flow from Operating Activities
	$
Net Income	7,100,000.00
Adjustments for non cash effects:
Depreciation expense	1,200,000.00
Other Adjustments	500,000.00
Changes in operating assets and liabilities:
Decrease in Accounts Payable	(200,000.00)
Decrease in Accounts Receivable	600,000.00
Increase in Inventory	(500,000.00)
Net Cash Flow from Operating Activities	8,700,000.00