Direct and Indirect Approaches Jalleen Associates started business on February 4, 2000. During its first year of operations, the company had sales of $445,600 and cost of goods sold of $284,000. At the end of the year, customers still owed Jalleen $17,000. The company reported wage expense of $85,000 for the year, including $3,000 of wages not yet paid at year-end. The company held inventory of $12,000 at the end of the year and owed $4,500 to suppliers. Jalleen recognized a total of $21,000 of depreciation expense for the year. All of the company’s other expenses of $29,400 were paid in cash, except for $1,300 still owed at year-end.

a. Present the operating section of Jalleen’s cash flow statement using the indirect approach.

b. Present the operating section of Jalleen’s cash flow statement using the direct approach.