Answer and Explanation:
The preparation of the cash flow from operating activities is presented below:
Cash Flows from Operating Activities
Net income $155,448
Adjustments
Add: Depreciation Expense $27,432
Add: Decrease in Accounts receivable $9,144 (81,280 - 90,424)
Add: Decrease in Inventory $4,064 (170,688 - 174,752)
Less: Increase in Prepaid expenses -$5,080 (27,432 - 22,352)
Add: Increase in Accrued expenses payable $10,160 (15,240 - 5,080)
Less : Decrease in Accounts payable -$7,112 (86,360 - 93,472)
Total of adjustments $38,608
Net Cash Provided by Operating Activities $194,056
The outflow of cash represents in negative sign and the positive sign reflects the inflow of cash
