Unit 2 (50 pts) 1. The net income reported on the income statement for the current year was $310.000 Depreciation recorded on fixed assets and amortization of patents for the year were $40,000 and 89,000, respectively. Balances of current asset and current liability accounts at the end and at the beginning of the year are as follows: Prod Cash End 550.000 560.000 Accounts receivable 112,000 108,000 - 060 Inventories 105,000 93.000 - ), 080 Prepaid expenses 4.500 6,500 - Accounts payable (merchandise creditors) 75.000 89,000 - 400 What is the amount of cash flows from operating activities reported on the statement of cash flows prepared by the indirect method? a. $233,000 b. S289.000 c. $387,000 d. S331,000 2. Accounts receivable arising from trade transactions amounted to $62,000 and $78,000 at the beginning and end of the year, respectively. Net income reported on the income statement for the year was $125,000. Exclusive of the effect of other adjustments, the cash flows from operating activities to be reported on the statement of cash flows prepared by the indirect method are: a. S109,000 b. S141,000 C. S125.000 d. $140,000 3. From the following data for David ProElecticals, calculate the quick ratio. Cash S 68,500 Accounts receivable 130,000 Inventories 213,000 Prepaid expenses 25.000 Total curreat assets $436,500 Less curreat liabilities 275.000 Working capital S161,500 a. 1.6 b. 0.7 c.0.3 d. 1.5