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Khaled Co. reports SR 100000 net income for the year ended 2018, account receivables decreased by...
Khaled Co. reports SR 100000 net income for the year ended 2018, account receivables decreased by SR 7000, account payable decreased by SR 6000, and during the 2018 reported SR 10000 of depreciation expenses. What is Khaled CO. operating cash flow for 2018?
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Expert Solution
| Ans. | Particulars | Amount | ||
| Cash flow from operating activities: | ||||
| Net income | SR 100000 | |||
| Adjustments to reconcile Net income to operating cash flow | ||||
| Income statement items not affecting cash | ||||
| Add: Depreciation expenses | SR 10000 | |||
| Changes in current operating assets and liabilities: | ||||
| Add: Decrease in accounts receivable | SR 7000 | |||
| Less: Decrease in accounts payable | -SR 6000 | |||
| Operating Cash Flow | SR 111000 | |||
| *EXPLANATIONS: | ||||
| *Decrease in current liabilities and Increase in current assets other than cash are deducted from Net Income. | ||||
| *Increase in current liabilities and Decrease in current assets other than cash are added to Net Income. | ||||
| *Non cash & Non operating expenses are added to Net income. | ||||
| *Non cash & Non operating income are deducted from Net income. | ||||
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