Data for Zumbrunn Company are presented in P17.5A.

P17.5

Zumbrunn Company€™s income statement contained the following condensed information.

Zumbrunn€™s balance sheets contained the comparative data at December 31, shown below.

Accounts payable pertain to operating expenses.

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

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Zumbrunn Company Income Statement For the Year Ended December 31, 2020 $970,000 Service revenue $624,000 Operating expenses, excluding depreciation Depreciation expense Loss on disposal of plant assets 60,000 16,000 700,000 Income before income taxes 270,000 Income tax expense 40,000 $230,000 Net income 2020 2019 Accounts receivable Accounts payable Income taxes payable $75,000 46,000 $65,000 28,000 7,000 11,000