Cash flow from operations was $700,000 for 2011 and $863,000 for 2012. Does this suggest that management of Great Oaks Furniture has manipulated earnings upward in these years?
The following information for Great Oaks Furniture, a retail furniture and design firm,relates.

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Great Oaks Furniture Balance Sheets December 31, 2012 December 31 2011 Assets Current assets: 41,200 570,000 5,070,000 83,800 5,765,000 1,097,000 6,862,000 Cash 53,000 443,000 4,841,000 78,000 5,415,000 1,095,000 6,510,000 Accounts receivable Inventory Prepaid expenses Total current assets Building and equipment, net Total assets Liabilities and Stockholders' Equity Current liabilities 604,000 679,000 Accounts payable 624,000 Bank loan payable Other accrued payables Total current liabilities Long-term debt Total liabilities Stockholders'equity: 625,000 1,562,000 3,359,000 1,359,000 1,496,000 3,225,000 Common stock Retained earnings 1,359,000 2.278,000 3,637,000 6,862,000 Total stockholders'equity Total liabilities and stockholders' equity 6,510,000 Year Ended December 31, 2011 $5,253,000 2,627,000 2,626,000 Year Ended December 31 Great Oaks Furniture Statement of Earnings 2012 Net sales Cost of goods sold Gross margin Operating expenses $5,568,000 2,840,000 2,728,000 501,000 835,000 1,336,000 1,392,000 139,000 1,253,000 439,000 814,000 Selling expenses 630,000 788,000 1,418,000 1,208,000 158,000 1,050,000 368,000 682,000 General and administrative expenses Total operating expenses Operating income Interest expense Income before taxes Income taxes Net income