12-7 Reporting Cash Flows from Operating Activities (Indirect Method) LO12-2 The following information pertains to Peak Heights Company: Income Statement for Current Year Sales $ 86,700 Expenses Cost of goods sold $ 51,775 Depreciation expense 7,400 Salaries expense 11,900 71,075 Net income $ 15,625 Partial Balance Sheet Current year Prior year Accounts receivable $ 11,000 $ 13,800 Inventory 13,000 9,800 Salaries payable 1,710 860 Required: Present the operating activities section of the statement of cash flows for Peak Heights Company using the indirect method.

Dahlia enterprises needs someone to supply it with 127,000 cartons of machine screws per year to support its manufacturing needs over the next five years, and you’ve decided to bid on the contract. it will cost you $940,000 to install the equipment necessary to start production; you’ll depreciate this cost straight-line to zero over the project’s life. you estimate that in five years, this equipment can be salvaged for $77,000. your fixed production costs will be $332,000 per year, and your variable production costs should be $11.00 per carton. you also need an initial investment in net working capital of $82,000. if your tax rate is 30 percent and your required return is 11 percent on your investment, what bid price should you submit? (do not round intermediate calculations and round your final answer to 2 decimal places. (e.g., 32.16))