Depreciation expenses with company analysis

The following income statement and information about changes in noncash current assets and current liabilities are reported.

 

SONAD COMPANY

Income Statement

For Year Ended December 31, 2013

Sales                          $ 2,445,000

Cost of goods sold  $1,198,050

Gross profit             $1,246,950

Operating expenses                                                                                        

Salaries expense $334,965

Depreciation expense $58,680

Rent expense $66,015

Amortization expenses–Patent $7,335

Utilities expense $26,895     $493,890

$753,060

Gain on sale of equipment $9,780

Net income                         $ 762,840

Changes in current asset and current liability accounts for the year that relate to operations follow.

Accounts receivable      $45,400 increase

Accounts payable            $8,050   decrease

Merchandise inventory                 $37,250 increase

Salaries payable                $3,400   decrease

 

Required: Prepare only the cash flows from operating activities section of the statement of cash flows using the indirect method. (Amounts to be deducted should be indicated with a minus sign.)

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