A. A partial balance sheet for orange company is presented below.

Orange Company

Income statement

For the year Ended December 31, 2019

Sales $100,000

Cost of goods sold (55,000)

Gross Profit $45,000

Operating expenses:

Salaries $10,000

Depreciation expense 4,000

Miscellaneous 1,000 (15,000)

Net Income $30,000

Orange Company

Balance Sheet

As at 31st December 2019

2018 2019

$7,000 $5,000 Cash

1,200 1,500 Account receivable

2,500 2,000 Inventories

250 500 Prepaid expenses

2,500 4,500 Furniture

10,000 7,000 Accounts Payable

900 500 Salaries Payable

1,500 2,000 Short term Bank Loan

Required: Prepare the operating activities section of the statement of cash flows using indirect method.