Question

Given the following information related to net changes in working capital accounts for the Player Company:

Increase Decrease
Cash $15,000
Trade accounts receivable (net) 8,400
Inventories $16,200
Salaries payable (operating) 6,000
Trade accounts payable 11,000

Cash Provided by Operating Activities is $100,000. The company also indicated that depreciation expense for the year was $14,200. Net Income is:

a. $73,000
b. $87,200
c. $118,200
d. $103,000
e. $103,200

Answer 1

a. $73,000

Step-by-step explanation:

Particulars Amount

Cash Provided by Operating Activities $100,000

- Depreciation Expenses ($14,200)

+ Increase in Trade accounts receivable (net) $8,400

- Decrease in Inventories ($16,200)

+ Decrease in Salaries payable (Operating) $6,000

- Increase in Trade accounts payable ($11,000)

Net Income $73,000