Answer:
$655,000
Explanation:
Cash flow from operating activities involved all the cash flows related to the operations of the company like sales , purchases, receivable, payable etc.
Net Cash flow is the net of receipts and Payment.
Following are the operating cash flows.
Cash flows from operating activities
Net Income                          $460,000
Add: Non cash Expense Adjustments:
Depreciation                          $107,000
Change in Working Capital:
Increase in Account receivable ($77,000)
Decrease in Inventory         $62,000
Increase in Account payable    $250,000
Less: Net Change in WC Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â $235,000
Other Adjustments
Gain on sale of Land                   ($147,000)
Net Operating Cash flow                $655,000
Depreciation is a non cash expense deducted from the revenue to calculate net income. Now it needs to be added back.
Answer:
The net cash provided by operating activities under the indirect method is $655,000.
Explanation:
Langley Company
Statement of cash flows (extract)
Net income                           $460,000
Add: Depreciation expense               107,000
Less: Gain on sale of land               (147,000)
Increase in accounts receivable           (77,000)
Decrease in inventory                    62,000
Increase in accounts payable             250,000
Net cash provided by operating activities  $655,000
