Exercise 16-4 Indirect: Cash flows from operating activities LO P2 The following income statement and information about changes in noncash current assets and current liabilities are SONAD COMPANY Income Statement For Year Ended December 31, 2017 Sales Cost of goods sold Gross profit Operating expenses 2,235,000 1,095,150 1,139,850 306,195 53,640 60,345 6,705 24,585 Salaries expense Depreciation expense Rent expense Amortization expenses-Patents Utilities expense 451,470 688,380 8,940 697,320 Gain on sale of equipment Net inco me Changes in current asset and current liability accounts for the year that relate to operations follow Accounts receivable Inventory 29,050 increase Accounts payable Salaries payable 14,375 decrease 3, 450 decrease 22, 850 increase Accounts receivable Inventory 29,050 increase Accounts payable Salaries payable 14,375 decrease 3,450 decrease 22,850 increase Required Prepare only the cash flows from operating activities section of the statement of cash flows using the indirect method. (Amounts to be deducted should be indicated with a minus sign.) Statement of Cash Flows (partial) Cash flows from operating activities $697,320 Net income Adjustments to reconcile net income to net cash provided by operating activities Income statement items not affecting cash Depreciation expense Amortization expense-Patents Gain on sale of equipment Increase in accounts receivable Changes in current operating assets and liabilities 53,640 8,940 $759,900