Partial Balance Sheets and Additional Information Are Listed Below for Sowell

question 82

Essay

Partial balance sheets and additional information are listed below for Sowell Company. Sowell Company
Partial Balance Sheets
as of December 31
$\begin{array}{|l|l|l|}\hline \text { Assets } & 2018 & 2017 \\\hline \text { Cash } & \$ 40,000 & \$ 20,000 \\\hline \text { Accounts receivable } & 70,000 & 85,000 \\\hline \text { Inventory } & 40,000 & 35,000 \\\hline \text { Liabilities } & & \\\hline \text { Accounts payable } & \$ 54,000 & \$ 62,000 \\\hline\end{array}$ Additional information for 2018:
Net income was $88,000.
Depreciation expense was $19,000.
Required:
Prepare the operating activities section of the statement of cash flows for 2018 using the indirect method.

---

Definitions:

Insurance Premium

A periodic payment made by an individual or company to an insurance company in exchange for coverage against specified risks.

Office Supplies

Office supplies encompass a range of items used in an office for the purpose of conducting day-to-day operations, including stationery, paper, pens, and computing equipment.

Journal Entries

The records of financial transactions in an accounting system that detail the accounts affected and in what manner, serving as the primary means to document financial activity.

General Ledger

A complete record of all financial transactions over the life of a company, used to compile the financial statements.