Winston Company reported net income of $50,000 for the year.During the year, accounts receivable decreased by $7,000, accounts payable increased by $3,000 and depreciation expense of $5,000 was recorded.Net cash provided by operating activities for the year is

Question

Quizplus · Accepted Answer

Net cash provided by operating activities is calculated by adjusting net income for changes in working capital and non-cash expenses. Starting with net income of $50,000, add the decrease in accounts receivable ($7,000), the increase in accounts payable ($3,000), and the depreciation expense ($5,000). This results in $50,000 + $7,000 + $3,000 + $5,000 = $65,000.

Winston Company Reported Net Income of $50,000 for the Year