accounting question?

Question

A company had net income of $27,000. Recorded depreciation expense was $16,000. During the year, Accounts Receivable and Inventory increased $15,000 and $40,000, respectively. Prepaid Expenses and Accounts Payable decreased $12,000 and $7,000, respectively. There was also a loss on the sale of equipment of $3,000. What was the amount of cash provided/(used) by operating activities during the year?

Answer 1

Cash Flow Statement
Profit before taxes 27,000
Adjustment for:
Depreciation 16,000
Loss on sale of equipment 3,000
Sub-total 46,000
Changes in working capital:
Increase in AR (15,000)
Increase in Inventory (40,000)
Decrease in prepaid expenses 12,000
Decrease in AP (7,000)
Cash generated from/(used in) operating activities (4,000)

Answer 2

Depreciation expense adds to net income.

Prepaid expense add.

Loss on sale of equipment add.


Increase in accounts receivable and inventory deduct.

Accounts payable deduct.


27,000. + 16,000. + 12,000. + 3,000. - 15,000. - 40,000. - 7,000. = (4,000.)

This shows a negative - 4,000. cash flow for the year.

Answer 3

i had to take accounting classes in college, and do my own work. so you figure it out yourself.... by the way, good luck!