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Answer:
The correct option is D,$402,000.
Explanation:
In determining the cash flow provided by operating activities,we need to adjust the net income for effects of non cash items reported.It is important to note that the reverse of the earlier treatment of the items is what is required now.For instance depreciation and amortization were deducted in income statement,for cash flow purposes we need to add both to net income.
Net income $315,000
add depreciation $90,000
amortization $15,000
loss on sale of equipment $9,000
less gain on sale of building($27000)
Cash flow from operations $402,000
The cash flow from operating activities as adjusted is $402,000.
The amount of net cash flow provided by operating activities is $402,000
- The calculation is as follows:
Net income $315,000
Add depreciation $90,000
Add: amortization $15,000
Add: loss on sale of equipment $9,000
Less: gain on sale of building ($27000)
Cash flow from operations $402,000
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