Green Brands, Inc. (GBI) presents its statement of cash flows using the indirect method. The following accounts and corresponding balances were drawn from GBIs Year 2 and Year 1 year-end balance sheets:

Account Title	Year 2				Year 1
Accounts receivable	$	21,300			$	29,700
Merchandise inventory		58,700				50,000
Prepaid insurance		18,400				25,700
Accounts payable		26,100				18,900
Salaries payable		4,650				4,150
Unearned service revenue		900				2,850

The Year 2 income statement is shown next:

Income Statement
Sales	$	611,000
Cost of goods sold		(371,000	)
Gross margin		240,000
Service revenue		4,700
Insurance expense		(39,000	)
Salaries expense		(156,000	)
Depreciation expense		(5,500	)
Operating income		44,200
Gain on sale of equipment		4,200
Net income	$	48,400

b. Prepare the operating activities section of the statement of cash flows using the indirect method for Year 2.

GREEN BRANDS, INC. Statement of Cash Flows (Operating Activities) For the Year Ended December 31, Year 2 Cash flows from operating activities: Add: Deduct: Add: noncash expenses Net cash flow from operating activities