Question

The accounting records of Hampton Company provided the data below ($ in thousands).

Net income	$	23,300
Depreciation expense		8,400
Increase in accounts receivable		4,600
Decrease in inventory		6,100
Decrease in prepaid insurance		1,500
Decrease in salaries payable		3,300
Increase in interest payable		900

Required:
Prepare a reconciliation of net income to net cash flows from operating activities. (Amounts to be deducted should be indicated with a minus sign. Enter your answers in thousands.)

Answer 1

Cash from operations = $32,300

.

Hampton Company
Cash Flow Statement
Cash Flow from Operating Activities:
Net Income		$          23,300.00
Add: Adjustments to reconcile net income to
Net cash from operating activities
Depreciation expense	$           8,400.00
Change in current assets and current liabilities
Increase in Accounts receivables	$        (4,600.00)
Decrease in Inventory	$           6,100.00
Decrease in prepaid insurance	$           1,500.00
Decrease in salaries payable	$        (3,300.00)
Increase in interest payable	$              900.00
		$            9,000.00
A. Cash Flow from Operating Activities		$          32,300.00