Presented below is the income statement of Culpepper lnc.: Sales 380,000 Cost of goods sold 225,000 Gross profit155,000 Operating expenses (including depreciation of $16.700) 85,000 Income before income taxes 70,000

Income taxes 28,000

Net Income 42,000

In addition, the following information related to the year end balances in the working capital accounts is presented: 2018 2017 Cash 2,000 60,000 Trade A/R 65,000 50,000 Inventory 20,600 40,000

Salaries Payable (operating expenses) 11,000 19,000

Trade Accounts payable 42,000 30,000

Income Taxes payable 15,000 18,000

Deferred Tax Liability 22,600 20,000 Instructions: Prepare the cash flows from operating activities using the direct method.