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
  • A. ①
  • B. ②
  • C.③
【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.