QS 16-7 Indirect: Computing cash from operations Q P2O CRUZ, INC. Income Statement For Year Ended December 31, 2019 $488,000 314,000 174,000 Sales Cost of goods sold Gross profit Operating expenses Depreciation expense $37,600 Other expenses 89,100 Income before taxes 126,700 47.300 Income taxes expense 17,300 Net income $ 30,000 CRUZ, INC. Comparative Balance Sheets At December 31 2019 2018 Assets Cash Accounts receivable, net Inventory $ 94,800 $ 24,000 41,000 51,000 85,800 95,800 5,400 4,200 Prepaid expenses Total current assets 227,000 175,000 Furniture 109,000 119,000 Comparative Balance Sheets At December 31 2019 2018 Assets Cash $ 94,800 $ 24,000 41,000 51,000 95,800 85,800 Accounts receivable, net Inventory Prepaid expenses Total current assets 5,400 4,200 227,000 175,000 Furniture Accum. depreciation-Furniture 109,000 119,000 (17,000) (9,000) $319,000 $285,000 Total assets $ 15,000 $ 21,000 9,000 5,000 1,400 2,600 25,400 28,600 Liabilities and Equity Accounts payable Wages payable Income taxes payable Total current liabilities Notes payable (long-term) Total liabilities Equity Common stock, $5 par value Retained earnings Total liabilities and equity 29,000 69,000 54,400 97,600 229,000 179,000 35,600 8,400 $319,000 $285,000 Required Use the indirect method to prepare the operating activities section of Cruz's statement of cash flows