Ask Question
BusinessBusiness
29 May, 07:51

During 2019, the Bowtie Company reported net income of $1,872 million, depreciation expense of $1,412 million and $978 million paid for purchases of property, plant, and equipment. Using the indirect method of preparing the statement of cash flows, what would be the effect on cash flows from operating activities during 2019

+2
Answers (1)
  1. 29 May, 08:17
    0
    The depreciation will be added back to the net income making the net cash flows from operating activities during 2019 to be $3,284 million.

    Explanation:

    The cash flow statement shows the movement in cash balance at the start and end of an accounting period. This is as a result of the company's activities which may be recognized in 3 groups namely; operating, investing and financing activities.

    The non-cash items deducted or added in the income statement while computing the net income are considered in the operating activities section of the cash flow statement while any amount paid for the purchase of an asset or received from the disposal of an asset is recognized in the investing section of the cash flow statement.

    The effect of the stated transactions on cash flows from operating activities during 2019 is that depreciation will be added back to the net income

    = $1,872 million + $1,412 million

    = $3,284 million
Know the Answer?
Not Sure About the Answer?
Find an answer to your question 👍 “During 2019, the Bowtie Company reported net income of $1,872 million, depreciation expense of $1,412 million and $978 million paid for ...” in 📗 Business if the answers seem to be not correct or there’s no answer. Try a smart search to find answers to similar questions.
Search for Other Answers
You Might be Interested in
The following data are taken from the stockholders' equity section of the balance sheet of Driftwood Company: Common Stock, $10 Par Value, 60,000 Shares Authorized, 33,600 Shares $ 336,000 Issued, 31,600 Shares Outstanding Additional Paid-in Capital
Answers (1)
In June 2017, Bill, a single taxpayer, purchased a home for $187.000. Later that year, he added a new room at a cost of $28,400. In May 2018, he sold the house for $473,000.
Answers (1)
Miller's hardware plans on saving $42,000, $54,000, and $58,000 at the end of each year for the next three years, respectively. how much will the firm have saved at the end of the three years if it can earn 4.5% on its savings
Answers (1)
Stevenson Company purchased equipment for $250,000 on January 1, 2010. The estimated salvage value is $50,000, and the estimated useful life is 5 years. The straight-line method is used for depreciation.
Answers (1)
Identifying Accounts to be Closed From the list that follows, identify the accounts that should be closed to the owner's capital account at the end of the fiscal year: a. Accounts Receivable b. Accumulated Depreciation c. Building d.
Answers (1)
New Questions in Business
What are the order of in which management can take legal action against a employee
Answers (1)
What best describes an entrepreneur? a. Someone who initiates and assumes the financial risk of a new business enterprise. b. A person who knows how to evaluate which stocks to purchase. c. Someone who can expertly manage other people's investments.
Answers (1)
JRN Enterprises just announced that it plans to cut its dividend from $3.50 to $2.50 per share and use the extra funds to expand its operations.
Answers (1)
Sykora, Inc., which uses a predetermined overhead rate based on direct labor hours, estimated total overhead for the year to be $12,000,000 and total direct labor hours to be 320,000 hours. Calculate Sykora's predetermined overhead rate.
Answers (1)
Appalachian mountain goods has paid increasing dividends of $.10, $.12, $.15, and $.20 a share over the past four years, respectively.
Answers (1)
Home » Business » During 2019, the Bowtie Company reported net income of $1,872 million, depreciation expense of $1,412 million and $978 million paid for purchases of property, plant, and equipment.
Sign Up Forgot Password?