Cash Flows from Operating ActivitiesIndirect Method

The income statement disclosed the following items for the year:

Depreciation expense	$56,100
Gain on disposal of equipment	32,750
Net income	460,500

The changes in the current asset and liability accounts for the year are as follows:

	Increase (Decrease)
Accounts receivable	$8,740
Inventory	(4,980)
Prepaid insurance	(1,870)
Accounts payable	(5,930)
Income taxes payable	1,870
Dividends payable	1,310

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 outflows, cash payments, decreases in cash, or any negative adjustments.

Statement of Cash Flows (partial)
For the year ended Dec. 31, --
Cash flows from operating activities:
Net income	$
Adjustments to reconcile net income to net cash flow from operating activities:
Depreciation expense
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
Net cash flow from operating activities		$