- Which of the following statements is true?
Purchase of a patent is an investing
cash outflow.
- Norton Company reported total sales revenue of $55,000, total expenses of $45,000, and net income of $10,000 on its income statement for the year ended December 31, 2010.
During 2010, accounts receivable decreased by $4,000, merchandise inventory decreased by $6,000, accounts payable increased by $2,000, and depreciation of $8,000 was recorded.
Therefore, based only on this information, the net cash flow from operating activities using the indirect method for 2010 was:
$30,000
- Bankers Company reported net income of $40,000, which included depreciation expense and depletion expense of $21,000 and $18,000, respectively.
The following changes also occurred during 2010:
Inventory $10,000 decrease
Accounts payable 5,000 decrease
Notes payable (long-term) 15,000 decrease
Income taxes payable 7,000 increase
Accounts receivable 10,000 increase
What is the cash flow from operating activities?
$81,000
