Thornton Company’s income statement contained the condensed information below.

THORNTON COMPANY Income Statement For the Year Ended December 31, 2014 Service revenue $970,000 Operating expenses, excluding depreciation $614,000 Depreciation expense 55,000 Loss on disposal of plant assets 16,000 685,000 Income before income taxes 285,000 Income tax expense 56,000 Net income $229,000 Thornton’s balance sheet contained the comparative data at December 31.

2014 2013 Accounts receivable $70,000 $60,000 Accounts payable 41,000 32,000 Income taxes payable 13,000 7,000 Accounts payable pertain to operating expenses.

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

AppendixLO1