单选题
A company reported the following for the year:
Net
sales
$ 500
Increase in
accounts receivable
20
Decrease in accounts payable
40
Increase in
inventory
30
Sale of new common stock
100
Repayment of debt
10
Depreciation
2
Net income
100
Interest expense on debt
5
The company's cash flow from operations(CFO) and cash flow
from investing(CFI) are closest to ;
CFO
CFI
①A. $12 $100
②B. $12 $0
③C. $92 $100
【正确答案】
B
【答案解析】Because net income is given, this problem involves using the indirect method.
Net income + $100
Noncash items: depreciation + 2
Change in accounts receivable -20
Change in inventory -30
Change in accounts payable {{U}}-40{{/U}}
CFO {{U}}$12{{/U}}
The interest expense is ignored because it is already deducted before net income is calculated.
Ignore sales for the same reason; net income incorporates sales. Investing cash flows include
buying and selling equipment and land. This problem does not involve any such cash flows.