Question 3 The income statement for Pharoah Ltd., a private company following ASPE, is presented here: PHAROAH LTD. Income Statement Year Ended November 30, 2018 Sales $8,100,000 Cost of goods sold 4,500,000 Gross profit 3,600,000 Operating expenses 2,080,000 Income from operations 1,520,000 Interest expense 105,000 Income before income tax 1,415,000 Income tax expense 310,000 Net income $1,105,000 Additional information: 1. Operating expenses include $76,000 of depreciation expense and a $103,000 impairment loss on property, plant, and equipment. 2. Accounts receivable increased by $189,000. 3. Inventory decreased by $60,000. 4. Prepaid expenses related to operating expenses increased by $45,000. 5. Accounts payable to suppliers of merchandise decreased by $182,000. 6. Accrued liabilities related to operating expenses decreased by $94,000. 7. Interest payable decreased by $14,000. 8. Unearned revenue that was received from customers decreased by $21,000. 9. Income tax payable increased by $23,000. RCES Prepare the operating activities section of the statement of cash flows, using the indirect method. (Show amounts that decrease cash flow with either a-sign e.g. - 15,000 or in parenthesis e.g. (15.000).) h 11- PHAROAH LTD. Statement of Cash Flows (Partial)-Indirect Method Year Ended November 30, 2018 Operating activities Study Adjustments to reconcile net income to Adjustments to reconcile net income to Questi