Blasik Corp. books revealed the following for the current year: What was the net cash flow from operating activities for the year?
A) cash flow from (inflow) $8,000
B) cash flow from (inflow) $0
C) cash flow used (outflow) $2,000
D) cash flow used (outflow) $4,000

Question

Blasik Corp. books revealed the following for the current year:  What was the net cash flow from operating activities for the year?
A) cash flow from (inflow) $8,000 
B) cash flow from (inflow) $0 
C) cash flow used (outflow) $2,000 
D) cash flow used (outflow) $4,000

Quizplus · Accepted Answer

The net increase in accounts receivable for the year was $6,000 and the net increase in accounts payable was $4,000, both of which are added back to net income to calculate net cash flow from operating activities using the indirect method. Additionally, the decrease in inventory resulted in a cash inflow of $2,000, but this does not affect the net increase in cash flow from operating activities. Therefore, the net cash flow from operating activities for the year is an outflow of $2,000.