The income statement and account balances for Chartrand Inc. are presented in E16€“4. 

Refer Data in E16-4,

Instructions

Prepare the operating section of a cash flow statement using the direct method?

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CHARTRAND INC. Comparative Balance Sheet Accounts 2014 2013 Cash $99,000 $105,000 Accounts receivable 52,000 41,000 32,500 7,500 Inventory Prepaid expenses Accounts payable Accrued expenses payable Dividends payable Income taxes payable 46,000 5,800 36,000 43,000 5,000 24,000 8,000 17,000 11,800 6,800 CHARTRAND INC. Income Statement Year Ended October 31, 2014 Sales $625,000 Cost of goods sold Gross profit Operating expenses Depreciation expense Loss on sale of equipment 390,000 235,000 $88,000 23,000 10,000 121,000 Profit before income taxes 114,000 Income taxes 29,000 Profit $ 85,000