Budget Auto Parts Company uses the indirect method to prepare the statement of cash flows

Question

Refer to the following income statement:

Budget Company
Income Statement
Year Ended December 31, 2017

Sales Revenue $360,000
Interest Revenue 1,500
Gain on Sale of Plant Assets 6,000
Total Revenues and Gains $367,500
Cost of Goods Sold 165,000
Salary Expense 67,500
Depreciation Expense 18,000
Other Operating Expenses 34,500
Interest Expense 1,500
Income Tax Expense 7,500
Total Expenses 294,000
Net Income (Loss) $73,500

Additional information provided by the company includes the following:
Current assets other than cash increase by $36,000.
Current liabilities decrease by $1,500.

Prepare the operating activities section of the statement of cash flows.
What will be an ideal response

Answer 1

Cash Flows from Operating Activities:
Net Income $73,500
Adjustments to Net Income:
Depreciation Expense 18,000
Gain on Disposal of Plant Assets (6,000 )
Increase in Current Assets (36,000 )
Decrease in Current Liabilities (1,500 ) (25,500 )
Net Cash Provided by Operating Activities $48,000