The net cash provided by operating activities in Sosa Company's statement of cash flows for 2011 was $115,000.For 2011, depreciation on plant assets was $45,000, amortization of patent was $8,000, and cash dividends paid on ordinary shares was $54,000.Based only on the information given above, Sosa's net income for 2011 was

Question

Quizplus · Accepted Answer

The net cash provided by operating activities is calculated as:

Net Income + Depreciation + Amortization - Increase in Current Assets + Increase in Current Liabilities

If we assume that there were no significant changes in current assets and liabilities, we can simplify the equation to:

Net Income + Depreciation + Amortization = Net Cash Provided by Operating Activities

Substituting the given values, we get:

115,000 = Net Income + 45,000 + 8,000
Net Income = 62,000

Therefore, the answer is B) $62,000.

The Net Cash Provided by Operating Activities in Sosa Company's