The cost of merchandise sold during the year was $54,000. Merchandise inventories increased by $2,000. Accounts payable increased by $3,000. Using the direct method of reporting cash flows from operating activities, cash payments for merchandise are calculateda. $47,000

b. $51,000

c. $53,000

d. $49,000

C=$53000

Explanation:

using the direct method of cash flow

Cash flow from operating Activities

opening stock Assumed = Nil

Cost of goods sold = 54000

Add: Stock increased by = 2000

Total Purchases (54+2) = 56000

Closing Paybles Increase by = (3000)

Cash Payments = opening + Purchases-closing payables

Cash Payments = Nil+56000-3000 = 56000