The current sections of Birmingham Inc.’s balance sheets for December 31, 2016, and 2017, are presented here. Birmingham’s net income for 2017 was $193,000. The income statement included depreciation expense, $25,000, amortization expense, $10,000, and a gain on disposal of equipment, $7,000. The equipment was sold for $47,000. Birmingham also issued bonds for $60,000.

2017 2016

Current assets

Cash $417,000 $ 99,000

Accounts receivable 120,000 93,000

Inventory 159,000 176,000

Prepaid expenses 29,000 24,000

Total current assets $725,000 $392,000

Current liabilities

Accrued expenses payable $ 17,000 $ 6,000

Accounts payable 88,000 94,000

Total current liabilities $105,000 $100,000

Instructions

Prepare the net cash provided by the operating activities section of the company’s statement of cash flows for the year ended December 31, 2017, using the indirect method. 

Answer rating: 100% (QA)

Cash provided by operating activities Net income 193000 Adjustments to reconcile net inco... View the full answer