Question

The net income for Howie Doohan Corporation was $280 million for the year ended December 31, 2018. Related information follows: Sale of common stock for cash, $34 million. Amortization of trademark, $2 million. Cash dividends paid, $28 million. Decrease in salaries payable, $2 million. Depreciation expense, $40 million. Increase in accounts payable, $18 million. Increase in bonds payable, $26 million. Net cash flows from operating activities during 2018 should be reported as:

Answer 1

$338 million

Step-by-step explanation:

Partial Statement of Cash Flows

For the Year Ended December 31, 2018

Cash Flows from Operating Activities:

Net income $280 million

Adjustments

Depreciation expense $40 million

Amortization of trademark $2 million

Increase in accounts payable $18 million

Less: Decrease in salaries payable $2 million $58 million

Net cash provided by operating activities $338 million