Question

Exercise 12-6 Indirect: Cash flow from operations LO P2 Salud Company reports the following information. Use the indirect method to prepare only the operating activities section of its tatement of cash flows for the year ended December 31, 2017 (Amounts to be deducted should be indicated with a minus sign.) Selected Year-End 2017 Balance Sheet Data Selected 2017 Income Statement Data $495,000 Accounts receivable increase 94,500 Prepaid expenses decrease 20,300 Accounts payable increase Net income Depreciation expense Gain on sale of machinery $50,400 14,700 9,600 3,100 Wages payable decrease Cash flows from operating activities Adjustments to reconcile net income to operating cash flow

Answer 1

Cash Flows from operating activities
Net income	495,000
Adjustments to reconcile net income to operating cash flow
Depreciation expense	94,500
Gain on sale of machinery	(20,300)
Accounts Receivable increase	(50,400)
Prepaid expenses Decrease	14,700
Accounts Payable increase	9,600
Wages payable Decrease	(3,100)
Net cash from operating activities	540,000