Able Company completed its income statement and balance sheet for 2010 and provided the following information:

In addition, Able bought a small service machine for $5,000.

Required:
1. Present the operating activities section of the statement of cash flows for Able Company using the indirect method.
2. What were the major reasons that Able was able to report a net loss but positive cash flow from operations? Why are the reasons for the difference between cash flow from operations and net income important to financialanalysts?

Income Statement Service revenue Expenses $51,000 Salaries Depreciation Amortization of copyrights Other expenses $41,000 5,000 200 8,700 54,900 Net loss $ 3,900) Partial Balance Sheet Accounts receivable Salaries payable 2009 S 8,000 $25,000 14,000 1000 1,000 5,100 2010 5 Other accrued liabilities