The income statement of Kraemer Inc. reported the following condensed information.

Kraemer€™s balance sheet contained these comparative data at December 31.

Kraemer has no depreciable assets. Accounts payable pertain to operating expenses.

Instructions
Prepare the operating activities section of the statement of cash flows using the indirectmethod.

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Kraemer Inc. Income Statement For the Year Ended December 31, 2008 Revenues Operating expenses Income from operations Income tax expense Net income $545,000 400,000 145,000 47,000 $98,000 Accounts receivable Accounts payable Income taxes payable 2008 $50,000 30,000 10,000 2007 $70,000 41,000 4,000