The income statement of Novak Company is shown below. NOVAK COMPANY INCOME STATEMENT FOR THE YEAR ENDED DECEMBER 31, 2020 Sales revenue $7.410,000 Cost of goods sold Beginning inventory $1.880,000 Purchases 4.360,000 Goods available for sale 6,240,000 Ending inventory 1.500,000 Cost of goods sold 4,740,000 Gross profit 2,670,000 Operating expenses Selling expenses 460,000 Administrative expenses 630,000 1,090,000 Net income $1,580,000 Additional information: Accounts receivable decreased $300.000 during the year. Prepaid expenses increased $170,000 during the year. 3. Accounts payable to suppliers of merchandise decreased $280,000 during the year. Accrued expenses payable decreased $130,000 during the year. Administrative expenses include depreciation expense of $60.000. 1 2 4. 5. Prepare the operating activities section of the statement of cash flows for the year ended December 31, 2020, for Novak Company. using the indirect method. (Show amounts that decrease cash flow with either a - sign e.g.-15,000 or in parenthesis eg. (15,000).) NOVAK COMPANY Statement of Cash Flows (Partial) S Increase in Accounts Payable Depreciation expense Decrease in Prepaid Expenses Increase in Prepaid Expenses Increase in Accounts Recevable Decrease in Inventory Decrease in Accounts Recevable Increase In Inventory Net Income Decrease in Accounts Payable Increase In Accrued Expenses Payable Decrease in Accrued Expenses Payable S