Messner Co. reported $145,000 of net income for 2012. The accountant, in preparing the statement of cash flows, noted several items occurring during 2012 that might affect cash flows from operating activities. These items are listed below and on page 1484.

  1. Messner purchased 100 shares of treasury stock at a cost of $20 per share. These shares were then resold at $25 per share.
  2. Messner sold 100 shares of IBM common at $200 per share. The acquisition cost of these shares was $165 per share. This investment was shown on Messner’s December 31, 2011, balance sheet as an available-for-sale security.

  3. Messner revised its estimate for bad debts. Before 2012, Messner’s bad debt expense was 1% of its net sales. In 2012, this percentage was increased to 2%. Net sales for 2012 were $500,000, and net accounts receivable decreased by $12,000 during 2012.
  4. Messner issued 500 shares of its $10 par common stock for a patent. The market price of the shares on the date of the transaction was $23 per share.
  5. Depreciation expense is $39,000.
  6. Messner Co. holds 30% of the Sanchez Company’s common stock as a long-term investment. Sanchez Company reported $27,000 of net income for 2012.
  7. Sanchez Company paid a total of $2,000 of cash dividends to all investees in 2012.
  8. Messner declared a 10% stock dividend. One thousand shares of $10 par common stock were distributed. The market price at date of issuance was $20 per share.

Instructions
Prepare a schedule that shows the net cash flow from operating activities using the indirect method. Assume no items other than those listed above affected the computation of 2012 net cash flow from operating activities.