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Determine the amount of cash flows from operations

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Reference no: EM132916866

Deo Company uses the indirect method to calculate cash flows. The following information pertains to operations for the accounting period January 1, 20x1~December 31, 20x1.

Net Income: $370,000

Depreciation expense: 30,000

Accounts receivable balance (Jan. 1) 30,000

Accounts receivable balance (Dec. 31) 17,000

Prepaid insurance (Jan. 1) 8,000

Prepaid insurance (Dec. 31) 9,000

Accounts payable balance (Jan. 1) 15,000

Accounts payable balance (Dec. 31) 13,000

Unearned rent revenue (Jan. 1) 17,000

Unearned rent revenue (Dec. 31) 19,500

Problem 1: Based upon the above information, determine the amount of cash flows from operations:

a. $413,500

b. $412,500

c. $411,500

d. None of the above

Problem 2: Who are the major information users of financial statements of a company?

a. managers of the company

b. government agencies who collect income taxes from the company

c. labor union of the company

d. stockholders and creditors of the company

Reference no: EM132916866

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