Lansing Company's current-year income statement and selected balance sheet data at December 31 of the current and prior years follow. LANSING COMPANY Income Statement For Current Year Ended December 31 Problem 12-2AB (Algo) Direct: Computing cash flows from operations LO P5 Sales revenue Expenses $ 112,200 Cost of goods sold Depreciation expense Salaries expense Rent expense Insurance expense 47,000 14,500 23,000 9,500 Required: Prepare the operating activities section of the statement of cash flows using the direct method for the current year. Note: Amounts to be deducted should be indicated with a minus sign. LANSING COMPANY Cash Flows from Operating Activities-Direct Method 4,300 For Current Year Ended December 31 Interest expense Utilities expense Net income 4,100 Cash flows from operating activities 3,300 Increase in accounts receivable Net income (700) (14.500) $ 6,500 Decrease in inventory 690 Increase in accounts payable (700) LANSING COMPANY Selected Balance Sheet Accounts Decrease in salaries payable 230 Decrease in utilities payable) 110 At December 31 Current Year Prior Year Decrease in prepaid rent (10) Accounts receivable $ 6,100 $ 6,800 Increase in prepaid insurance. (70) Inventory 2,480 1,790 Net cash provided by operating activities $ (14,950) Accounts payable 4,900 5,600 Salaries payable 980 750 Utilities payable 320 210 Prepaid insurance 310 380 Prepaid rent 320 230