Operating activities—indirect method (Learning Objective 3) 10–15 min.

Lake Norman Company reported a net income of $205,000 for the current year.

Depreciation recorded on equipment amounted to $5,000 for the year. Balances of the current accounts at the beginning and end of the year are as follows:

Accounts Receivable .......................................

Accounts Payable............................................

$42,000 24,000 Beginning of Year

$32,000 18,000 End of Year Prepare the cash flows from the operating activities section of the statement of cash flows using the indirect method.

AppendixLO1