Asked by VALERIA BARDALES on Jun 24, 2024
Verified
Samuel Company's accumulated depreciation-equipment increased by $6,000, while patents decreased by $2,200 between balance sheet dates. There were no purchases or sales of depreciable or intangible assets during the year. In addition, the income statement showed a loss of $3,200 from the sale of investments. Assume no changes in noncash current assets and liabilities.
Reconcile a net income of $92,000 to net cash flow from operating activities.
Accumulated Depreciation
The total amount of depreciation expense that has been recorded against an asset from the time it was put into use to the current date.
Patents
Legal documents that grant an inventor exclusive rights to their invention for a certain period, preventing others from making, using, or selling it.
Operating Activities
Activities related to the core business functions of a company, including revenue production and expense payment, directly impacting its cash flow.
- Convert net income figures to corresponding net cash flow from operating activities.
Verified Answer
$92,000
Adjustments to reconcile net income to net cash flow from operating activities:
Depreciation
6,000
Amortization
2,200
Loss from sale of investments
3,200
Net cash flow from operating activities
$103,400
Learning Objectives
- Convert net income figures to corresponding net cash flow from operating activities.
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