# Marjorie is preparing the Statement of Cash Flows for her company. Based on the following...

## Question:

Marjorie is preparing the Statement of Cash Flows for her company. Based on the following information, what would be the Cash Provided by Operating Activities using the Indirect Method?

 Net Income $10,000 Decrease in Accounts Receivable$2,000 Increase in Wages Payable $1,000 Increase in Equipment$6,000 Decrease in Bonds Payable $15,000 A.$1,000

B. $13,000 C.$11,000

D. $5,000 ## Operating cash flow: Operating cash flow refers to the cash flow provided by the operations of the company. It is calculated to analyze whether the company is generating enough cash flows to work in future or the operations need to be revived. ## Answer and Explanation: Option (B)$13,000 is correct.

Computation of cash provided by operating activity

 Particular Amount Net income $10,000 Add: Decrease in account receivable$2,000 Add: Increase in wages payable $1,000 Cash flow from operating activity$13,000