Reference no: EM131877095

Question - Cash flows from operating activities

Presented below is the income statement of Angola, Inc.

Sales $324,000

Cost of goods sold $214,000

Gross profit $110,000

Operating expenses $67,000

Income before income taxes $43,000

Income taxes $17,200

Net income $25,800

In addition, the following information related to net changes in working capital is presented.

Debit Credit

Cash $10,600

Accounts receivable $2,400

Inventories $3,600

Salaries payable (operating expenses) $12,000

Accounts payable $15,000

Income taxes payable $1,400

Depreciation expense for the year was $14,700

Deferred tax liability account increased $1,800

Required: Prepare a schedule computing the net cash flow from operating activities that would be shown on a statement of cash flows -(b) using the direct method.