Cash Flows from Operating Activities-Indirect Method The net income reported on the income statement for the current year was $308,000. Depreciation recorded on equipment and a building amounted to $92,100 for the year. Balances of the current asset and current liability accounts at the beginning and end of the year are as follows: End of Year Beginning of Year Cash Accounts receivable (net) $82,240 $87,170 104,280 107,570 Inventories 205,600 185,320 Prepaid expenses 11,430 12,290 Accounts payable (merchandise creditors) Salaries payable 91,860 13,240 97,280 12,120 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 adjustments. 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 Changes in current operating assets and liabilities: Decrease in accounts receivable Increase in inventories Decrease in prepaid expenses Decrease in accounts payable Increase in salaries payable Net cash flow from operating activities