REFERENCE: Ref.06_11
The balance sheets of Butler,Inc.and its 70 percent-owned subsidiary,Cassie Corp. ,are presented below:
Additional information for 2009:

-Net cash flow from operating activities was:

Question

REFERENCE: Ref.06_11
The balance sheets of Butler,Inc.and its 70 percent-owned subsidiary,Cassie Corp. ,are presented below:
  Additional information for 2009:
 
-Net cash flow from operating activities was:

Quizplus · Accepted Answer

To calculate the net cash flow from operating activities, we need to use the indirect method of the cash flow statement. We start with Butler Inc's net income of $220,000 and adjust for non-cash expenses (depreciation and amortization) of $104,000, as these do not involve any cash payments. We also adjust for changes in current assets and liabilities, such as an increase in accounts receivable of $37,000 and a decrease in accounts payable of $28,000. These changes affect the cash flow from operating activities. Adding these adjustments gives us the net cash flow from operating activities for Butler Inc of $63,000. We do not need to consider Cassie Corp's balance sheet in this calculation. Therefore, the correct answer is C.

REFERENCE: Ref.06_11 The Balance Sheets of Butler,Inc.and Its 70 Percent-Owned Subsidiary,Cassie Corp