Question

Optics Company uses the direct method for preparing its statement of cash flow. Optics reports the following information regarding​ 2019:

From the income​ statement:

Sales​ Revenues, $268,000

Cost of Goods​ Sold, $215,000

Operating​ Expenses, $36,000

Net Income $17,000

From the balance​ sheet:

	Beginning Balance	Ending Balance
Accounts Receivable	$14,900	$17,800
Merchandise Inventory	23,500	18,000
Accounts Payable	6,900	14,000
Accrued Liabilities	4,200	1,700

Assume that there were no sales of long−term ​assets, no interest​ revenue, and no expenses other than the expenses shown above.​ Also, assume that Accounts Payable are for purchases of merchandise inventory only. Accrued liabilities relate to operating expenses. What amount will be shown for the net cash provided by operating​ activities?

A. $62,700

B. $9,900

C. $24,200

D. $17,000

Answer 1

Cash flow from Operating activities	Amount(in $)
Net Income/(Loss)	17,000
Less:Increase in Accounts Receivable	(2,900)
Add:Decrease in Merchandise Inventory	5,500
Add:Increase in Accounts Payable	7,100
Less:Decrease in Accrued Liabilities	(2,500)
Net Cash flow from Operating activities	24,200
So Option C is answer