Income Statement

Income Statement

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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.)