The following information appeared on the 2012 income statement of Kane Company: Based on this information, what is Kane's net cash provided by operations?

Question

The following information appeared on the 2012 income statement of Kane Company:  Based on this information, what is Kane's net cash provided by operations?

Quizplus · Accepted Answer

To calculate net cash provided by operations, we need to add back non-cash expenses such as depreciation and subtract any changes in current assets and liabilities. 
Starting with net income of $100,000, we add depreciation of $60,000 and subtract the increase in accounts receivable of $12,000 and the decrease in accounts payable of $10,000. 
Net cash provided by operations is therefore $158,000 (Option B).

The Following Information Appeared on the 2012 Income Statement of Kane