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Preparing the Cash Flow from Operating Activities Section Sarasota Corp. reported net income of $80,000, which...

Preparing the Cash Flow from Operating Activities Section

Sarasota Corp. reported net income of $80,000, which included depreciation expense of $10,400. It also reported a decrease in accounts receivable and salaries payable of $5,600 and $3,200, respectively. Further, it reported an increase in inventory of $11,200 and an increase in accounts payable of $7,680.

Calculate its net cash provided by operating activities $____

Please show your work!

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Answer #1
Net income 80,000
Add:depreciation expense 10400
Add:Decrease in AR 5600
Less:Decrease in salary payable (3200)
Less:increase in inventory (11200)
Add:increase in AP 7680
Net cash provided by operating activities $89280

NOTE:Decrease in current liabilities is an outflow of cash and vice versa.
Decrease in current assets is an inflow of cash and vice-versa.

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