Rewe Company’s income statement contained the condensed information below. 

Accounts payable pertain to operating expenses. 

Instructions 

Prepare the operating activities section of the statement of cash flows using the indirect method.

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Rewe Company Income Statement For the Year Ended December 31, 2022 Service revenue $970,000 Operating expenses, excluding depreciation Depreciation expense Loss on disposal of plant assets $614,000 55,000 16,000 685,000 Income before income taxes 285,000 Income tax expense 56,000 $229,000 Net income Rewe's balance sheets contained the following comparative data at December 31. 2022 2021 Accounts receivable $70,000 $60,000 32,000 Accounts payable Income taxes payable 41,000 13,000 7,000 Accounts payable pertain to operating expenses.