Exercise 12-4 Indirect: Cash flows from operating activities LO P2 The following income statement and additional year-end information is provided. $1,922,000 941,780 980,220 SONAD COMPANY Income Statement For Year Ended December 31 Sales Cost of goods sold Gross profit Operating expenses Salaries expense $263,314 Depreciation expense 46,128 Rent expense 51,894 Amortization expenses-Patents 5,766 Utilities expense 21.142 Cain on sale of equipment Net Income 388, 244 591,976 7.688 $ 599,664 Accounts receivable Inventory $45,350 increase 25,375 Increase Accounts payable salaries payable $11,025 decrease 4,650 decrease Prepare the operating activities section of the statement of cash flows using the Indirect method (Amounts to be deducted should be indicated with a minus sign.) Prepare the 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) Cash flows from operating activities Not income $ 599,684 Adjustments to reconcile net income to net cash provided by operating activities Income statement items not affecting cash Depreciation expense 46,128 Amortization expense Patents 5,766 Gain on sale of equipment 7,680 Increase in accounts receivable 45, 350 Changes in current operating assets and liabilities Increase in inventory Decrease in accounts payable Decrease in salaries payable ces Net cash provided by operating activities $ 704,596