Carlyn Corporation’s accumulated depreciation—furniture account increased by $7,500, while $2,750 of patent amortization was recognized 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 $4,000 from the sale of land. Reconcile a net income of $107,500 to net cash flow from operating activities.
Answer:
Net income…………………………………………………………………………………… $107,500
Adjustments to reconcile net income to net cash flow from
operating activities:
Depreciation……………………………………...…………………………………… 7,500
Amortization of patents………………………………...…………………………… 2,750
Loss from sale of land…………………………..…………………………………… 4,000
Net cash flow from operating activities………………………..……………………… $121,750
