In: Accounting
Net income of Mansfield Company was $45,000. The accounting records reveal depreciation expense of $80,000 as well as increases in prepaid rent, salaries payable, and income taxes payable of $60,000, $15,000, and $12,000, respectively. Prepare the cash flows from operating activities section of Mansfield's statement of cash flows using the indirect method.
Cash Flows from Operating Activities:
Net income $45,000
Adjustments for noncash effects:
Depreciation expense 80,000
Changes in operating assets and liabilities:
Increase in prepaid rent (60,000)
Increase in salaries payable 15,000
Increase in income taxes payable 12,000
Net cash inflows from operating activities $92,000
Net cash inflows from operating activities: $92,000