In the course of preparing a company's statement of cash flows, the following figures are to be included in the calculation of net cash from operating activities.
| Depreciation charges | 200,000 |
| Profit on sale of non-current assets | 30,000 |
| Increase in inventories | 630,000 |
| Decrease in receivables | 720,000 |
| Increase in payables | 75,000 |
What will the net effect of these items be in the statement of cash flows?
Suggested solutions:
| Cash Flow | Inflow | Outflow |
| Depreciation charges | 200,000 | |
| Profit on sale of non-current assets | 30,000 | |
| Increase in inventories | 630,000 | |
| Decrease in receivables | 720,000 | |
| Increase in payables | 75,000 | |
| Total | 995,000 | 660,000 |
| Answer | 335,000 |
Note: positive inflow means - addition to operating profit; negative inflow means substraction from operating profit
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2015 ACCA F3 OPERATING CASH FLOW