3 The income statement and selected balance sheet information for Direct Products Company for the year ended December 31 are as follows: $48,600 7.11/8 points awarded Income Statement Sales Revenue Expenses: Cost of Goods Sold Depreciation Expense Salaries Expense Rent Expense Insurance Expense Interest Expense Utilities Expense Scored 21,000 2,000 9,000 4,500 1,900 1,800 1,400 Net Income $ 7,000 eBook Print References Selected Balance Sheet Accounts Ending Balances Accounts Receivable $ 560 Merchandise Inventory 990 Prepaid Rent 25 Prepaid Insurance 25 Accounts Payable 440 Salaries Payable 100 Utilities Payable 20 Beginning Balances $ 580 770 20 28 460 70 15 Required: Prepare the cash flows from operating activities section of the statement of cash flows using the indirect method. (Amounts to be deducted should be indicated by a minus sign.) DIRECT PRODUCTS COMPANY Statement of Cash Flows (Partial) For the Year Ended December 31 Cash flows from operating activities: Net income $ 7,000 Adjustments to reconcile net income to net cash provided by operating activities: Decrease in accounts receivable $ 20 Increase in merchandise inventory (220) Increase in prepaid rent (5) Decrease in prepaid insurance 3 Decrease in accounts payable (20) Increase in salaries payable 30 Increase in utilities payable X % oooooo 5 (187) Net cash provided (used) by operating activities 6,813 "Red text indicates no response was expected in a cell or a formula-based calculation is incorrect; no points deducted