Trinity Coatings Company uses the indirect method to prepare its statement of cash flows. Refer to the following information for 2018: The beginning balance in the Cash account was $2700.
Net cash provided by operating activities: $41,000
Net cash used for investing activities: $(28,000)
Net cash provided by financing activities: $1800
The statement of cash flows will show ________.

Question

Quizplus · Accepted Answer

To calculate the ending cash balance, we need to add the beginning cash balance to the net cash provided by operating activities, then subtract the net cash used for investing activities and add the net cash provided by financing activities. 
Beginning cash balance: $2,700 
Net cash provided by operating activities: $41,000 
Net cash used for investing activities: $(28,000) 
Net cash provided by financing activities: $1,800

Ending cash balance = Beginning cash balance + Net cash provided by operating activities - Net cash used for investing activities + Net cash provided by financing activities 
= $2,700 + $41,000 - $28,000 + $1,800 
= $17,500

Therefore, the statement of cash flows will show ending cash of $17,500. Options A and B are not correct as they do not consider the cash flows from investing and financing activities. Option C is not correct as it shows the net cash provided by investing and financing activities as negative, which is incorrect.

Trinity Coatings Company Uses the Indirect Method to Prepare Its