Pella Company presents its statement of cash flows using the indirect method. The following accounts and corresponding balances were drawn from Pella’s Year 2 and Year 1 year-end balance sheets:

The income statement reported a $700 loss on the sale of equipment, a $900 gain on the sale of land, and $2,500 of depreciation expense. Net income for the period was $36,500.

Required
Prepare the operating activities section of the statement of cash flows.

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Account Title Year 2 Year 1 Accounts receivable Prepaid rent Interest receivable Accounts payable Salaries payable Unearned revenue $24,000 1,650 $21,000 1,900 1,200 8,500 2,900 1,800 900 10,200 2,700 2,000