Reference no: EM132193223

Question - The net income reported on an income statement for the current year was $250,000. Depreciation recorded on fixed assets for the year was $45,500. Balances of the current asset and current liability accounts at the end and beginning of the year are listed below.

Ending Beginning

Cash $56,000 $59,500

Accounts receivable (net) 71,000 73,400

Inventories 140,000 126,500

Prepaid expenses 7,800 8,400

Accounts payable 62,600 66,400

Cash dividends payable 4,500 7,000

Salaries payable 9,000 8,250

Prepare the cash flows from operating activities section of a statement of cash flows using the indirect method.

If the direct method had been required for this problem, would the net cash flows from operating activities have been the same? Explain.