Zumbrunn Company's income statement contained the condensed information below.

ZUMBRUNN COMPANY Income Statement For the Year Ended December 31, 2017
Service revenue		$970,000
Operating expenses, excluding depreciation	$624,000
Depreciation expense	60,000
Loss on disposal of equipment	16,000	700,000
Income before income taxes		270,000
Income tax expense		40,000
Net income		$230,000

Zumbrunn's balance sheet contained the comparative data at December 31, shown below.

	2017	2016
Accounts receivable	$75,000	$65,000
Accounts payable	46,000	28,000
Income taxes payable	11,000	7,000

Accounts payable pertain to operating expenses.

Instructions

Prepare the operating activities section of the statement of cash flows using the DIRECT METHOD.

Cash from operations $318,000