The following information is available for Bernard Corporation for 2011:

Required:
1. Compute the net cash flows from operating activities using the indirect method.
2. What are the causes of the major differences between net income and net cash flow from operating activities?

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Net income Decrease in accounts receivable Increase in inventory Decrease in prepaid rent Increase in salaries payable $ 4,270 7,900 ncrease in notes payable (due 2015 50,000 44,700 11,000 $179,200 Decrease in income taxes payable 18,300 Depreciation expense 2,100 4,410 Loss on disposal of equipment