Blaylock Company provided the following partial comparative balance sheets and the income statement for 2012.
Blaylock Company
Comparative Balance Sheets
At December 31, 2011 and 2012
.....................................................2011................. 2012
Current assets:
Accounts receivable....................... $375,000............ $291,250
Inventories................................... 150,000.............. 160,000
Current liabilities:
Wages payable............................... 350,000............. 257,500
Blaylock Company
Income Statement
For the Year Ended December 31, 2012
Revenues................................................ $1,500,000
Gain on sale of equipment................................. 50,000
Less: Cost of goods sold................................ (960,000)
Less: Depreciation expense............................. (135,000)
Less: Interest expense....................................... (5,000)
Net income................................................ $ 450,000
Required:
Compute operating cash flows using the indirect method.