Question

Gutierrez Company reported net income of $196,600 for 2020. Gutierrez also reported depreciation expense of $43,700 and a loss of $4,900 on the disposal of plant assets. The comparative balance sheet shows a decrease in accounts receivable of $11,600 for the year, a $13,600 Increase in accounts payable, and a $3,000 decrease in prepaid expenses. Prepare the operating activities section of the statement of cash flows for 2020. Use the indirect method. (Show amounts that decrease cash flow with either a sign .g. - 15,000 or in parenthesis 9. (15,000)) GUTIERREZ COMPANY Partial Statement of Cash Flows Adjustments to reconcile net income to

Answer 1

Partial statement of cash flow

For the year ended December 31,2020

Cash flow from operating activities
Net income		196600
Adjustment to reconcile net income to
Net cash flow from operating activities
Depreciation expense	43700
Loss on disposal of plant assets	4900
Decrease account receivable	11600
Increase account payable	13600
Decrease prepaid expense	3000
		76800
Net cash provided by operating activities		273400