Exercise 12-4 Indirect: Cash flows from operating activities LO P2

The following income statement and information about changes in noncash current assets and current liabilities are reported.

SONAD COMPANY Income Statement For Year Ended December 31, 2017
Sales				$	1,805,000
Cost of goods sold					884,450
Gross profit					920,550
Operating expenses
Salaries expense	$	247,285
Depreciation expense		43,320
Rent expense		48,735
Amortization expensesPatents		5,415
Utilities expense		19,855			364,610
					555,940
Gain on sale of equipment					7,220
Net income				$	563,160

Changes in current asset and current liability accounts for the year that relate to operations follow.

Accounts receivable	$	15,250		increase		Accounts payable	$	9,275		decrease
Inventory		25,675		increase		Salaries payable		3,400		decrease

Required:

Prepare only the cash flows from operating activities section of the statement of cash flows using the indirect method. (Amounts to be deducted should be indicated with a minus sign.)

Statement of Cash Flows (partial) eBook Cash flows from operating activities Hint Adjustments to reconcile net income to net cash provided by operating activities Print Income statement items not affecting cash References Changes in current operating assets and liabilities $