Refer to the information in PB12-2.

Required:

Prepare the cash flows from operating activities section of the 2010 statement of cash flows using the direct method.

Data from PB12-2

The income statement and selected balance sheet information for Calendars Incorporated for the year ended December 31, 2010, is presented below.

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Income Statement Selected Balance Sheet Accounts Sales Revenue $78,000 2010 2009 Expenses: Merchandise Inventory $ 430 $ 490 Cost of Goods Sold 36,000 Accounts Receivable 1,800 1,500 Depreciation Expense 16,000 Accounts Payable 1,200 1,300 Salaries Expense 10,000 Salaries Payable 450 300 Rent Expense 2,500 Utilities Payable 100 0 Insurance Expense 1,300 Prepaid Rent 50 100 Interest Expense 1,200 Prepaid Insurance 70 Utilities Expense 1,000 1020 90 Net Income $10,000