Question

A new accountant, Costa Goodsold, put together a preliminary version of Medina Co.'s financial statements. Medina's Net Income was $500, its Depreciation Expense was $100, and its Cash Flow from Operations was $70. The CEO found an error that Costa made in computing straight-line Depreciation Expense, which should have been $50. What is Medina's Cash Flow from Operations after fixing this mistake

Answer 1

the cash flow from operation after fixing the mistake is $20

Step-by-step explanation:

The computation of the cash flow from operation after fixing the mistake is as follows;

Cash flow from operations $70

Less; Depreciation expense -$100

Add: Depreciation expense $50

Net Cash flow from operations $20

Hence, the cash flow from operation after fixing the mistake is $20

The same is to be considered and relevant