The income statement of Tina Maria Company is presented here:

Additional information:
1. Accounts receivable increased \(\$ 510,000\) during the year.
2. Prepaid expenses increased \(\$ 170,000\) during the year.
3. Accounts payable to merchandise suppliers increased \(\$ 50,000\) during the year.
4. Accrued expenses payable decreased \(\$ 180,000\) during the year.
\section*{Instructions}
Prepare the operating activities section of the statement of cash flows for the year ended December 31, 1998, for Tina Maria Company, using the indirect method.

Transcribed Image Text:

Sales Cost of goods sold TINA MARIA COMPANY Income Statement For the Year Ended December 31, 1998 $7,100,000 Beginning inventory $1,700,000 Purchases 5,430,000 Goods available for sale 7,130,000 Ending inventory 1,920,000 Total cost of goods sold 5,210,000 Gross profit 1,890,000 Operating expenses Selling expenses 400,000 Administrative expense 525,000 Depreciation expense 75,000 Amortization expense 30,000 1,030,000 Net income $ 860,000