A consolidated income statement and selected comparative consolidated balance sheet data for Palano Company and subsidiary follow:

Palano Company and Subsidiary Consolidated Income Statement for the Year Ended December 31, 2015
Sales				$701,000
Cost of sales				263,000
Gross profit				438,000
Operating expenses:
Depreciation expense		$76,000
Selling expenses		122,000
Administrative expenses		85,000		283,000
Consolidated net income				155,000
Less noncontrolling interest in consolidated net income				38,750
Controlling interest in consolidated net income				$116,250

		December 31
		2014		2015
Accounts receivable		$229,000		$318,000
Inventory		194,000		234,000
Prepaid selling expenses		26,000		30,000
Accounts payable		99,000		79,000
Accrued selling expenses		96,000		84,000
Accrued administrative expenses		56,000		39,000

1- Prepare the cash flow from operating activities section of a consolidated statement of cash flows assuming use of the Direct method.