The income statement of Novak Company is shown below. Novak Company Income Statement For the Year...

Transcribed Image Text:

The income statement of Novak Company is shown below. Novak Company Income Statement For the Year Ended December 31, 2025 Sales revenue $6,910,000 Cost of goods sold Beginning inventory $1,860,000 Purchases 4,820,000 Goods available for sale 6,680,000 Ending inventory 1,560,000 Cost of goods sold 5,120,000 Gross profit 1,790,000 Operating expenses Selling expenses 450,000 Administrative expenses 710,000 1,160,000 Net income $630,000 Additional information: 1. Accounts receivable decreased $340,000 during the year. 2. Prepaid expenses increased $150,000 during the year. 3. Accounts payable to suppliers of merchandise decreased $250,000 during the year. 4. 5. Accrued expenses payable decreased $130,000 during the year. Administrative expenses include depreciation expense of $60,000. A Prepare the operating activities section of the statement of cash flows for the year ended December 31, 2025, for Novak Company, 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).) NOVAK COMPANY Partial Statement of Cash Flows Adjustments to reconcile net income to 1A > > > EA The income statement of Novak Company is shown below. Novak Company Income Statement For the Year Ended December 31, 2025 Sales revenue $6,910,000 Cost of goods sold Beginning inventory $1,860,000 Purchases 4,820,000 Goods available for sale 6,680,000 Ending inventory 1,560,000 Cost of goods sold 5,120,000 Gross profit 1,790,000 Operating expenses Selling expenses 450,000 Administrative expenses 710,000 1,160,000 Net income $630,000 Additional information: 1. Accounts receivable decreased $340,000 during the year. 2. Prepaid expenses increased $150,000 during the year. 3. Accounts payable to suppliers of merchandise decreased $250,000 during the year. 4. 5. Accrued expenses payable decreased $130,000 during the year. Administrative expenses include depreciation expense of $60,000. A Prepare the operating activities section of the statement of cash flows for the year ended December 31, 2025, for Novak Company, 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).) NOVAK COMPANY Partial Statement of Cash Flows Adjustments to reconcile net income to 1A > > > EA