Cash Flows from Operating ActivitiesIndirect Method

The net income reported on the income statement for the current year was $153,300. Depreciation recorded on store equipment for the year amounted to $25,300. Balances of the current asset and current liability accounts at the beginning and end of the year are as follows:

	End of Year		Beginning of Year
Cash	$58,870		$54,160
Accounts receivable (net)	42,210		40,020
Inventories	57,630		60,930
Prepaid expenses	6,480		5,150
Accounts payable (merchandise creditors)	55,160		51,240
Wages payable	30,140		33,470

a. Prepare the Cash Flows from Operating Activities section of the statement of cash flows, using the indirect method. Use the minus sign to indicate cash out flows, cash payments, decreases in cash, or any negative adjustments.

Statement of Cash Flows (partial)
Cash flows from operating activities:
	$fill in the blank a643aafeff9d02b_2
Adjustments to reconcile net income to net cash flow from operating activities:
	fill in the blank a643aafeff9d02b_4
Changes in current operating assets and liabilities:
	fill in the blank a643aafeff9d02b_6
	fill in the blank a643aafeff9d02b_8
	fill in the blank a643aafeff9d02b_10
	fill in the blank a643aafeff9d02b_12
	fill in the blank a643aafeff9d02b_14
Net cash flow from operating activities		$fill in the blank a643aafeff9d02b_15

b. Cash flows from operating activities differs from net income because it does not use the of accounting. For example revenues are recorded on the income statement when .