Interest paid

Hello Sir, In the following question why they did not deduct the interset paid to get the net cash flow from operations I thgink the answer should be C Thanks, Q Zeta Co is preparing its statement of cash flows under indirect method. The following extracts have been taken from the statement of financial position as at 31 December 2016: 20X5 20X6 Account receivable $50,000 $55,000 Inventory $16,000 $12,000 Account payable $22,000 $25,000 In addition, the following information is relevant: (1) The profit before interest and tax is $70,000 (2) The cost and net book value of the non-current assets are $100,000 and $80,000 respectively. The business charges straight line depreciation at 20% per annum. (3) The business incurred loss on foreign operations of $5,000. (4) The business paid interest of $4,000 on outstanding debt. Calculate the amount of cash generated from operations. A) $90,000 B) $92,000 C) $93,000 D) $97,000 Answer D Profit before interest and tax $70,000 Depreciation ($100,000 x 20%) $20,000 Increase in account receivable ($5,000) Foreign exchange loss $5,000 Decrease in inventory $4,000 Increase in payable $3,000 Cash generated from operations $97,000