Refer to the information in CP12-2.

Income StatementSales Revenue...............................................$2,060Expenses:Cost of Goods Sold............................................900Depreciation Expense.......................................200Salaries Expense................................................500Rent Expense......................................................250Insurance Expense...............................................80Interest Expense..................................................60Utilities Expense...................................................50Net Income........................................................$ 20

Required:

Prepare the cash flows from operating activities section of the 2017 statement of cash flows using the direct method.

TIP: Convert the cost of goods sold to cash paid to suppliers by adding the increase in inventory and subtracting the increase in accounts payable.

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Selected Balance Sheet Accounts 2016 2017 $ 82 $ 60 Merchandise Inventory 380 Accounts Receivable 450 210 200 Accounts Payable Salaries Payable Utilities Payable 29 20 60 Prepaid Rent 2 10 Prepaid Insurance 14