Stale Bread Co. had net income in the current year of $700,000. Depreciation expense for the year was $80,000. Between the beginning and the end of the current year the company's accounts payable (all to suppliers of raw materials) increased $100,000 while accounts receivables from customer sales also increase by $150,000. The company also issued a long-term bond payable in exchange for receiving $300,000 cash. Compute the amount of cash provided or used for OPERATING ACTIVITIES, only, by the indirect method.
Stale Bread Co. had net income in the current year of $700,000.
Cash flow Statement: This statement showing the inflows and outflows of cash and cash equivalents during the particular year. It measures how well the company generates cash to pay its debt obligations and fund its operating expenses.
Cash flow statement divided into three different activities:
1) Cash flow from operating activities.
2) Cash flow from investing activities.
3) Cash flow from Financing activities.
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