Calculate cash from operating activities using the indirect method. (LO 5)

The information shown is from the comparative balance sheets of Matt's Music Company at December 31, 2008 and 2007.

Net income for 2008 was \(\$ 211,000\). Depreciation expense of \(\$ 80,000\) was included in the operating expenses for the year.
\section*{Required}
Use the indirect method to prepare the cash from operations section of the statement of cash flows for Matt's Music Company for the year ended December 31, 2008.

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(in thousands) Current assets: Cash At December 31 2008 2007 $3,500 $2,090 Accounts receivable 2,725 2,980 Inventory 1,050 1,300 Prepaid insurance 520 470 Total current assets $7,795 $6,840 Current liabilities: Accounts payable $2,890 $1,650 Salaries payable 1,500 3,200 Total current liabilities $4,390 $4,850