E14-4 Villa Company reported net income of $195,000 for 2008.Villa also reported depreciation

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Villa Company reported net income of $195,000 for 2008.Villa also reported depreciation
expense of $45,000 and a loss of $5,000 on the sale 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 $4,000 decrease in prepaid expenses.

Instructions
Prepare the operating activities section of the statement of cash flows for 2008. Use the indirect
method.