Cash Flows from Operating ActivitiesIndirect Method

The net income reported on the income statement for the current year was $235,000. Depreciation recorded on equipment and a building amounted to $70,300 for the year. 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	$63,450		$66,620
Accounts receivable (net)	80,450		82,210
Inventories	158,630		141,630
Prepaid expenses	8,820		9,390
Accounts payable (merchandise creditors)	70,870		74,350
Salaries payable	10,220		9,260

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:
Net income	$
Adjustments to reconcile net income to net cash flow from operating activities:
Depreciation
Changes in current operating assets and liabilities:
Decrease in accounts receivable
Increase in inventories
Decrease in prepaid expenses
Decrease in accounts payable
Increase in salaries payable
Net cash flow from operating activities		$