The income statement of Percival Company is presented on page 650.
Additional information:
1. Accounts receivable decreased $320,000 during the year, and inventory increased $140,000.
2. Prepaid expenses increased $175,000 during the year.
3. Accounts payable to merchandise suppliers increased $60,000 during the year.
4. Accrued expenses payable increased $145,000 during the year.

Instructions
Prepare the operating activities section of the statement of cash flows for the year ended December 31, 2010, for Percival Company, using the indirectmethod.

Transcribed Image Text:

PERCIVAL COMPANY Income Statement For the Year Ended December 31, 2010 Sales Cost of goods sold S5,400,000 $1,780,000 3,430,000 5,210,000 1,920,000 Beginning inventory Purchases Goods available for sale Ending inventory Total cost of goods sold Gross profit Operating expenses 3,290,000 2,110,000 Selling expenses Administrative expensc Depreciation expense Amortization expense 420,000 525,000 105,000 20,000 1,070,000 $1,040,000 Net income