Answer:
Prepare the Cash flow from Operating Activities Section as follows :
Net income 62,000
Adjustments for Non - Cash Items :
Depreciation - Land, buildings, and equipment 38,000
Adjustment for Working Capital Items :
Increase in Accounts Receivable (12,950)
Increase in Inventory (21,200)
Decrease in Prepaid Insurance 620
Decrease in Accounts payable (73,530)
Decrease in Salaries payable (5,700)
Decrease in Notes payable (51,200)
Net Cash from Operating Activities (63,960)
Explanation:
Note that the question has requested use of indirect method for preparation of cash flows from operating activities.
