Question: The following information was taken from the 2014 financial statements

The following information was taken from the 2014 financial statements of Zurich Corporation, a maker of fine Swiss watches:
Net income .......... $(200,000)
Depreciation .......... 50,000
Increase (decrease) in
Accounts receivable ...... (140,000)
Inventories ............ 25,000
Other current assets ....... 10,000
Accounts payable ....... 120,000
Accrued payables ....... (25,000)
Interest payable ......... 50,000

Required:
1. Calculate Zurich’s cash flow from operating activities for 2014.
2. Explain the reasons for the difference between the firm’s net income and its cash flow from operating activities in 2014.


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  • CreatedSeptember 10, 2014
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