Acompany has net income of $10, which included $2 of depreciation expense. there were no other noncash expenses in net income and there were no gains or losses. accounts receivable was $20 at the beginning of the year and $25 at the end of the year. accounts payable was $15 at the beginning of the year and $5 at the end of the year. inventory was $12 at the beginning of the year and $7 at the end of the year. all other balance sheet accounts were unchanged over the year. what was the company’s cash flow from operating activities?

2

Explanation:

The company's cash flow from operating activities can be calculated as follows:

                                                                                                $

Net Income                                                                            10

Add:depreciation expense                                                    2

Less:changes in accounts receivable                                  (5)

(20-25)

Less:changes in accounts payable                                      (10)

(5-15)

Add:changes in inventory                                                     5

(12-7)

Cash flow from operating activities                                       2