Question

2. A company had a net income of Rs. 165,000 during 2015. It provided
for a depreciation of Rs. 75,000 during the year. During the year,
accounts receivable increased by Rs. 55,000 and accounts payable
increased by Rs. 25,000. The company's cash flow from operating
activities was
a. Rs. 320,000
b. Rs. 170,000
c. Rs. 210,000
d. Rs. 120,000​

Answer 1

B. 1,70,000.

Net income = 1,65,000

Less :- Depreciation = (75000)

__________________________--

Before working capital = 90,000

Add :- increase in assets = 55000 + 25000 = 80000

________________________________

Cash flow from operating activity = 90,000 + 80000 = 1,70,000 answer.

Thanks.

Answer 2

Answer:

net income 1,65,000

add: Depreciation 75,000

less: Account receivable (55,000)

add: Account payable 25,000

____________________________

operating activities = 2,10,000