Statement of Cash Flows

Gutierrez Company reported net income of $225,000 for 2020. Gutierrez also reported depreciation expense of $45,000 and a loss of $5,000 on the disposal of equipment. The comparative balance sheet shows a decrease in accounts receivable of $15,000 for the year, a $17,000 increase in accounts payable, and a $4,0000 decrease in prepaid expenses.

Instructions

Prepare the operating activities section for the statement of cash flows for 2020. Use the indirect method..

Solutions