The Income Statement and a Partial Balance Sheet for Jefferson

The income statement and a partial balance sheet for Jefferson Company is presented below.Prepare the
operating activities section of the statement of cash flows using the direct method.
Jefferson Company
Income Statement
For the Current Year
$$\begin{array} { | l | r | r | } \hline \text { Sales } & & \$ 500,000 \\\hline \text { Cost af goods sold } & & 390,000 \\\hline \text { Gross profit } & & \$ 110,000 \\\hline \text { Operating expenses: } & & \\\hline \text { Salaries } & \$ 70,000 & \\\hline \text { Depreciation expense } & 20,000 & \\\hline \text { Miscellanedus } & 10,000 & 100,000 \\\hline \text { Net income } &10,000 & \\\hline\end{array}$$
$\begin{array}{c}\text { Jefferson Company }\\\text { Partial Balance Sheet }\\\text { End of this year}\\\\\begin{array}{|l|r|r|}\hline &\text { End of this year } & \text { End of prior year }\\\hline \text { Cash } & \$ 80,000 & \$ 65,000 \\\hline \text { Accounts receivable (net) } & 57,000 & 50,000 \\\hline \text { Inventories } & 102,000 & 86,000 \\\hline \text { Prepaid expenses } & 4,500 & 4,000 \\\hline \text { Accounts payable (merchandise) } & 58,000 & 51,000 \\\hline \text { Salaries payable } & 7,500 & 6,000\\\hline \end{array}\end{array}$