Textbook Problem

The income statement for Piura Merchandising Corporation is as follows:

Other information is as follows:

1. a. Accounts payable decreased by $20,000 during the year.
2. b. Accounts receivable increased by $20,000.
3. c. All wages were paid at the beginning of the year; at the end of the year, wages payable had a balance of $12,000.
4. d. Prepaid insurance increased by $24,000 during the year.

Required:

Prepare a schedule of operating cash flows using the direct method.