Question

File Edit View History Bookmarks Window Help Ch 2 HW Help Save & Submit Check my work Problem 2-9 Statement of Cash Flows (LG2-4) Ramakrishnan, Inc. reported 2018 net income of $55 milion and depreciation of $3.050.000. The top part of Ramakrishnan, Inc.'s 2018 and 2017 balance sheet isted below On millions of dollars) 3 521 Current Ilahi ered and outs payable Sotes payable Calculate the 2018 net cash flow from operating activities for kishnan, Inc. (Enter your answer in dollars not in milions) < Prov to Next >

Answer 1

Increase in accounts receivable and inventory:

Accounts receivable = $89 - $85 = $4

Inventory = $195 - $130 = $65

Increase in accrued wages and taxes and accounts payable:

Accrued wages and taxes = $34 - $28 = $6

Accounts payable = $67 - $60 = $7

Net cash flow from operating activity = Net income + Depreciation - (Increase in accounts receivable and inventory) + (Increase in accrued wages and taxes and accounts payable)

= $55 + $3.05 - ($65 + $4) + ($6 + $7)

= $2,050,000 or $2.05 million