SONAD COMPANY
Income Statement
For Year Ended December 31
Sales
$ 1,658,000
Cost of goods sold
812,420
Gross profit
845,580
Operating expenses
Salaries expense
$ 227,146
Depreciation expense
39,792
Rent expense
44,766
Amortization expenses-Patents
4,974
Utilities expense
18,238
334,916
Gain on sale of equipment
510,664
6,632
Net income
$ 517,296
Accounts receivable
$ 10,500 increase Accounts payable
$ 14,600 decrease
Inventory
33,225 increase Salaries payable
1,450 decrease
Prepare the operating activities section of the statement of cash flows using the indirect method.
Note: Amounts to be deducted should be indicated with a minus sign.
Cash flows from operating activities
Net income
$ 517,296