Horton Industries Reported Net Income of $150,000 for the Current

Essay

Horton Industries reported net income of $150,000 for the current year. The balances in its accounts receivable and allowance for bad debts accounts are shown below:
$$\begin{array} { | l | r | r | } \hline { \text { Account } } & \mathbf { 1 2 / 3 1 / 2 0 1 9 } & { \mathbf { 1 / 1 / 2 0 1 9 } } \\\hline \text { Accounts Receivable } & \$ 52,000 & \$ 45,000 \\\hline \text { Allowance for Uncollectible Accounts } & 10,000 & 7,000 \\\hline & & \\\hline\end{array}$$
In addition, the company recorded $11,000 of bad debt expense and wrote off $8,000 of uncollectible accounts. There are no other relevant transactions or account balances. Prepare the operating section of the cash flow statement under the indirect method.