The income statement for Wholly Bagel Company for the current year ended June 30 and balances of selected accounts at the beginning and the end of the year are as follows:

Prepare the cash flows from operating activities section of the statement of cash flows, using the direct method.

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Sales Cost of merchandise sold Gross profit Operating expenses: $184,000 67,000 $117,000 Depreciation expense Other operating expenses $14,500 49,000 Total operating expenses Income before income tax Income tax expense Net income 63,500 53,500 15,400 38,100 Beginning of Year End of Year Accounts receivable (net) Inventories Prepaid expenses Accounts payable (merchandise creditors) Accrued expenses (operating expenses) Income tax payable $14,800 38, 100 6,000 27,900 7,900 1,500 $12,900 33,100 6,600 25,900 8,600 1,500