Norman Company’s income statement for the year ended December 31, 2012, contained the following condensed information.

Service revenue                                                                          $840,000
Operating expenses (excluding depreciation)         $624,000
Depreciation expense                                                  60,000
Loss on sale of equipment                                           26,000     710,000
Income before income taxes                                                        130,000
Income tax expense                                                                        40,000
Net income                                                                                  $ 90,000

Norman’s balance sheet contained the following comparative data at December 31.

                    

(Accounts payable pertains to operating expenses.)
Instructions
Prepare the operating activities section of the statement of cash flows using the direct method.