M12-5 (Static) Computing Cash Flows from Operating Activities (Indirect Method) [LO 12-2]

The two independent cases are listed below:

	Case A		Case B
	Year 2	Year 1	Year 2	Year 1
Sales Revenue	$ 11,000	$ 9,000	$ 21,000	$ 18,000
Cost of Goods Sold	6,000	5,500	12,000	11,000
Gross Profit	5,000	3,500	9,000	7,000
Depreciation Expense	1,000	1,000	1,500	1,500
Salaries and Wages Expense	2,500	2,000	5,000	5,000
Net Income	$ 1,500	$ 500	$ 2,500	$ 500
Accounts Receivable	$ 300	$ 400	$ 750	$ 600
Inventory	750	500	730	800
Accounts Payable	800	700	800	850
Salaries and Wages Payable	1,000	1,200	200	250

Required: Show the operating activities section of the statement of cash flows for year 2 using the indirect method. (Amounts to be deducted should be indicated with a minus sign.)