21.

The accounting records of the Princess Leia Linen Company is provided the data below.

Net income	$	25,900
Depreciation expense		4,000
Decrease in accounts receivable		2,700
Increase in inventory		5,200
Increase in prepaid insurance		370
Increase in salaries payable		830
Decrease in interest payable		470

Required: Prepare a reconciliation of net income to net cash flows from operating activities.

Cash flows from operating activities:

Net income

Adjustments for noncash effects:

Changes in operating assets and liabilities:

Net cash flows from operating activities