Krauss Company's income statement for the year ended December 31, 2017, contained the following condensed information.

Service revenue $845,540

Operating expenses (excluding depreciation). $625,700

Depreciation expense 57,390

Loss on sale of equipment 29,170 712,260

Income before income taxes 133,280

Income tax expense 40,190

Net income $93,090

Krauss's balance sheet contained the following comparative data at December 31.

2017 2016

Accounts receivable $36,010 $59,510

Accounts payable 45,780 31,020

Income taxes payable 4,070 8,680

(Accounts payable pertains to operating expenses.)

Using the direct method, what is the Net Cash provided by Operating Activities?

Question

Business

Freeway

11 December, 01:48

Krauss Company's income statement for the year ended December 31, 2017, contained the following condensed information.

Service revenue $845,540

Operating expenses (excluding depreciation). $625,700

Depreciation expense 57,390

Loss on sale of equipment 29,170 712,260

Income before income taxes 133,280

Income tax expense 40,190

Net income $93,090

Krauss's balance sheet contained the following comparative data at December 31.

2017 2016

Accounts receivable $36,010 $59,510

Accounts payable 45,780 31,020

Income taxes payable 4,070 8,680

(Accounts payable pertains to operating expenses.)

Using the direct method, what is the Net Cash provided by Operating Activities?

+5

Answers (1)

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Paris Garcia · Answer 1

Net Cash provided by Operating Activities 146,000

Explanation:

using the income statement values and the balance sheet beginning and ending we can solve for the cash collection and disbursements:

beginning

+ net income figure:

total amount to collect/pay

less ending

actually paid/collected

collected from customer:

36,010 + 845,540 - 59,510 = 822,040

payment of expenses:

45,780 + 625,700 - 31,020 = 640,460‬

tax paid:

4,070 + 40,190 - 8,680 = 35,580‬

cash from operation

822,040 - 640,460 - 35,580 = 146,000