84 Cash flows from operating activities (indirect and direct methods) Presented below is the latest income statement of Minx Ltd.: Sales $1,900,000 Cost of goods sold 1,125,000 Gross profit $775,000 Operating expenses 425,000 Income before income taxes 350,000 Income taxes 140,000 Net income $ 210,000 In addition, the following information related to net changes in working capital is available: Debit Credit Cash $60,000 Accounts receivable (net) 40,000 Inventories $77,000 Prepaid expenses 20,000 Salaries payable (operating expenses) 30,000 Accounts payable 45,000 Income tax payable 15,000 Minx Ltd. also reports that depreciation expense for the year was $68,500 and that the deferred tax liability account increase