accounting

Cash flow from operating activities is calculated using the direct method. This means that the changes and transactions made by the company during the reporting period are evaluated, and cash inflows and outflows arising from operations are captured. In this case, cash inflows include revenue from sales, interest, and dividends, while cash outflows will include expenses such as taxes, salaries, cost of goods sold (COGS), and interest expenses.

To calculate cash flow from operating activities for Lauren Company for the year ended December 31, 2010, we can subtract the relevant accounts from the previous year's year-end figures (e.g. 12/31/10) from the same period for this year (e.g. 12/31/09) and add any other relevant cash inflows and outflows, as mentioned above.

Cash flow from operating activities:

Change in Accounts Receivable: $(5,200)
Change in Accounts Payable: 2,900
Change in Merchandise Inventory: 6,000
Revenue from Sales: 243,000
Interest Revenue: 5,600
Dividend Revenue: 1,200
Tax Expense: (12,300)
Salaries Expense: (28,000)
COGS: (65,000)
Interest Expense: (3,600)
Operating