Data for Munsun Company are presented in P12.3A. 

Instructions 

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

Data From P12.3A

The income statement of Munsun Company is presented here. 

Additional information: 

1. Accounts receivable decreased $380,000 during the year, and inventory decreased $300,000. 

2. Prepaid expenses increased $150,000 during the year. 

3. Accounts payable to suppliers of merchandise decreased $350,000 during the year. 

4. Accrued expenses payable decreased $100,000 during the year. 

5. Administrative expenses include depreciation expense of $110,000.    

Transcribed Image Text:

Munsun Company Income Statement For the Year Ended November 30, 2022 Sales revenue $7,600,000 Cost of goods sold Beginning inventory $1,900,000 Purchases 4,400,000 Goods available for sale 6,300,000 Ending inventory 1,600,000 Total cost of goods sold 4,700,000 Gross profit Operating expenses Selling expenses Administrative expenses 2,900,000 450,000 700,000 1,150,000 Net income $1,750,000