Question 1

Using the following data, prepare the operating activities section of a statement of cash flows for Maximum Corporation for the year ended December 31, 20X6, using the indirect method.

Increase in salary payable $1,50

Decrease in accounts payable 2,0000

Increase in accounts receivable 3,500

Net income 98,00

Decrease in inventory 5,800

Increase in prepaid expenses 1,200

Depreciation expense equipment 5,000

Depreciation expense building 7,500

Gain on sale of equipment 1,300

Loss on sale of patent 2,500