The income statement for Whistler Ltd., a publicly traded company following ASPE, is presented here:
WHISTLER LTD.
Income Statement
Year Ended November 30, 2018
Sales........................................................$8,000,000
Cost of goods sold....................................5,000,000
Gross profit...............................................3,000,000
Operating expenses...................................2,000,000
Income from operations............................1,000,000
Interest expense...........................................100,000
Income before income tax...........................900,000
Income tax expense.....................................300,000
Net income...............................................$ 600,000
Additional information:
1. Operating expenses include $75,000 of depreciation expense and a $100,000 impairment loss on property, plant, and equipment.
2. Accounts receivable increased by $190,000.
3. Inventory decreased by $50,000.
4. Prepaid expenses related to operating expenses increased by $40,000.
5. Accounts payable to suppliers of merchandise decreased by $180,000.
6. Accrued liabilities related to operating expenses decreased by $90,000.
7. Interest payable decreased by $10,000.
8. Unearned revenue that was received from customers decreased by $17,000.
9. Income tax payable increased by $20,000.
Instructions
(a) Prepare the operating activities section of the statement of cash flows, using the indirect method.
(b) Would your answer in part (a) change if Whistler were a public company following IFRS?