(Appendix 11A) Determining Net Cash Flow from Operating} Activities-Direct Method Presented below are selected statement of financial position information and the statement of earnings information for Burch Company.

\section*{Required:}
Compute the net cash flows from operating activities using the direct method.

\section*{Exercise

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Selected Statement of Financial Position Information Dec. 31, 2018 Dec. 31, 2017 Cash $20,000 $17,500 Accounts receivable 10,500 8.000 Inventory 18,000 21,000 Accounts payable 15,000 10,000 Income taxes payable 1,000 2,500 Sales Burch Company Statement of Earnings For the year ended December 31, 2018 Cost of goods sold Depreciation expense Other expenses Income tax expense Net income $ 250,000 (160,000) (15,000) (35,000) (12,000) $ 28,000