Cash Flows from Operating ActivitiesIndirect Method

The net income reported on the income statement for the current year was $149,900. Depreciation recorded on store equipment for the year amounted to $24,700. Balances of the current asset and current liability accounts at the beginning and end of the year are as follows:

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 and for any adjustments, if required.

16-3

End of Year $59,660 42,780 58,410 6,560 55,900 30,550 Beginning of Year Cash Accounts receivable (net) Merchandise inventory Prepaid expenses Accounts payable (merchandise creditors) Wages payable $55,480 41,000 62,420 5,270 52,480 34,290