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Question
The net income reported on the income statement for the current year was $58,000. Depreciation recorded on fixed assets for the year was $24,000. In addition, equipment with an original cost of $130,000 and accumulated depreciation of $115,000 on the date of the sale was sold for $20,000. Balances of the current asset and current liability accounts at the end and beginning of the year are as follows:
| End | Beginning | |
| Cash | $65,000 | $ 70,000 |
| Accounts Receivable (net) | 70,000 | 63,000 |
| Inventories | 85,000 | 102,000 |
| Prepaid Expenses | 4,000 | 4,500 |
| Accounts Payable (merchandise creditors) | 50,000 | 58,000 |
| Cash Dividends Payable | 4,500 | 6,500 |
| Salaries Payable | 6,000 | 7,500 |
Prepare the operating activities section of the statement of cash flows, using the indirect method.
Answer
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