Cash Flows from Operating Activities-Indirect Method The income statement disclosed the following items for the year: Depreciation expense $46,000 26,830 Gain on disposal of equipment 287,600 Net income The changes in the current asset and liability accounts for the year are as follows: Increase (Decrease) Accounts receivable $7,160 (4,080) Inventory Prepaid insurance (1,530) (4,860) Accounts payable Income taxes payable 1,530 Dividends payable 1,070 a. Prepare the "Cash flows from operating activities" section of the statement of cash flows, using the indirect method. Use the minus sign to indicate cash out flows, cash payments, decreases in cash, or any negative adjustmen Statement of Cash Flows (partial) Cash flows from operating activities: Net income Adjustments to reconcile net income to net cash flow from operating activities: Depreciation Gain on disposal of equipment Changes in current operating assets and liabilities: Increase in accounts receivable Decrease in inventory Decrease in prepaid insurance Decrease in accounts payable Increase in income taxes payable