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Mallory Michaels, senior accountant for Trendy Fashions, has gathered the following balances from the company’s general...

Mallory Michaels, senior accountant for Trendy Fashions, has gathered the following balances from the company’s general ledger:

December 31, 2016 December 31, 2015
Accounts Receivable $49,487 $62,531
Inventories 144,830 118,706
Prepaid Expenses 4,500 3,820
Accounts Payable 40,078 48,398
Accrued Liabilities 14,190 11,405
Income Taxes Payable 1,490 11,675
Net Income 712,821
Depreciation Expense 84,098
Loss on the sale of land 15,500


Using the indirect method, prepare the cash flows provided by operating activities section of the statement of cash flows for 2016. (Show amounts that decrease cash flow with either a - sign, e.g. -15,000 or in parentheses, e.g. (15,000).)

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Answer #1
Cash flow from operating activities
net income 712,821
Adjustments to net income
depreciation expense 84,098
loss on the sale of land 15,500
decrease in account receivable 13044
increase in inventories -26124
increase in prepaid expense -680
Decrease in accounts payable -8320
increase in accrued liabilities 2785
decrease in income taxes payable -10185
Net cash flow from operating activities 782,939
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