The statement of income of Kneale Transport Inc. for the year ended December 31, 2017, reported the following condensed information:

Kneale's statement of financial position included the following comparative data at December 31:

Additional information: Operating expenses include $70,000 in depreciation expense. The company follows IFRS. Assume that interest is treated as an operating activity for purposes of the statement of cash flows.
Instructions
(a) Prepare the operating activities section of the statement of cash flows for the year ended December 31, 2017, using the indirect method.
(b) From the perspective of an external user of Kneale Transport's financial statements, discuss the usefulness of the statement of cash flows prepared using either the indirect or the direct method.

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KNEALE TRANSPORT INC. Statement of Income Year Ended December 31, 2017 Service revenue Operating expenses Income from operations Other revenues and expenses $545,000 370,000 175,000 Gain on sale of equipment $25,000 10,000 Interest expense Income before income taxes Income tax expense Net income 15,000 190,000 42,000 $148,000 Accounts receivable Prepaid insurance Accounts payable Interest payable Income tax payable Unearned revenue 2017 $50,000 8,000 30,000 2,000 8,000 10,000 2016 $60,000 5,000 41,000 750 4,500 14,000