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10 September, 14:21

Kraco Corporation reported 2010 set income of $450,000, includang the effects of deprecaation expense of $60,000, and amortization expense on a patest of $10,000. Also, cash of $50,000 was borrowed on a 5-year note payable.

Based on this data, total cash inflow from operating activities using the indirect method for 2010 was:

a. 1470.000

b. 440,000

c. 570,000

d. 520,000

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  1. 10 September, 15:46
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    d. 520,000

    Explanation:

    The computation of the cash flow from operating activities using the indirect method is shown below:

    cash flows from operating activities

    Net income reported $450,000

    Add: depreciation expenses $60,000

    Add: Amortization expenses $10,000

    Net cash flow provided by operating activity is $520,000

    We simply added the above three items so that the correct amount could come
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