12-4 Use the direct line method to determine cash flows from operating activities

Exercise 12-4A (Algo) Use the direct method to determine cash flows from operating activities LO 122 The following accounts and corresponding balances were drawn from Avia Company's Year Z and Year 1 year-end balance sheets During the year, $65,000 of unearned revenue was recognized as having been earned. Rent expense for Year 2 was $25,500. Required Based on this information alone, prepare the operating activities section of the statement of cash flows assuming the direct approach is used Note: Amounts to be deducted should be indicated with a minus sign. Cash flow from operating activities: Collections of interest Decrease in prepaid rent Increase in unearned revenue Paid for rent Receipts from customers