Martin, Inc Additional Information

question 28

Essay

Martin, Inc.'s, income statement is shown below.Based on this income statement and the other information provided, calculate the net cash provided by operations using the indirect method.
$\begin{array}{c} \text { MARTIN, INC }\\ \text { Income Statement }\\ \text {For Year Ended December 31, 2013 }\\\begin{array}{|l|r|r|}\hline \text { Sales } & & \$ 248,000 \\\hline \text { Cost of goods sold } & & 116,000 \\\hline \text { Gross profit } & & \$ 132,000 \\\hline \text { Operating expenses: } & & \\\hline \text { Wages and salaries expense } & \$ 44,000 & \\\hline \text { Rent expense } & 16,000 & \\\hline \text { Depreciation expense } & 30,000 & \\\hline \text { Other operating expenses } & 18,000 & 108,000 \\\hline \text { Income from operations } & & \$ 24,000 \\\hline \text { Gain on sale of equipment } & & 26,000 \\\hline \text { Income before income taxes } & & \$ 50,000 \\\hline \text { Income taxes expense } & & 17,500 \\\hline \text { Net income } & & \$ 32,500 \\\hline\end{array}\end{array}$
Additional information:
$$\begin{array} { | l | r | } \hline \text { Increase in accounts receivable } & \$ 4,000 \\\hline \text { Increase in accourts payable } & 16,000 \\\hline \text { Increase in income taxes payable } & \mathbf { 3 0 0 } \\\hline \text { Decrease in prepaid expenses } & 10,000 \\\hline \text { Decrease in rnerchardise irveritory } & 14,000 \\\hline \text { Decrease in long-temn notes payable } & \mathbf { 2 0 , 0 0 0 } \\\hline\end{array}$$

---

Definitions:

Reddening

The process of becoming red, often as a response to emotion, heat, or injury.

Classification

A system for organizing data into categories for efficient handling and analysis.

Chemical Burn

Tissue damage caused by direct contact with chemicals that can cause destruction of the skin and underlying tissues.

Flooding

An overflow of water that submerges land that is usually dry, often caused by heavy rainfall, hurricanes, or melting snow.