Pierce Company reported net income of $250,000 for the current year. Depreciation recorded on buildings and equipment amounted to $80,000 for the year. Balances of the current assets and current liability accounts at the beginning and end of the year are listed below.

Instructions:

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

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End of the Year Beginning of the Year Cash Accounts Receivable Inventories Prepaid Expenses Accounts Payable Income taxes payable S20,000 19,000 50,000 7.500 12,000 1,600 $15,000 32,000 65,000 5,000 18,000 1.200