7.26 The following information has been extracted from Lowe Dairy Products Company's Statement of Financial Position and Income Statement for the years ended 31 March 20X3 and 31 March 20X4. 20X4 Sales 20X3 $689,000 470,000 $785,000 Cost of Goods Sold Gross Profit 534,000 219,000 251,000 Wages Expense 57,000 90,000 46,000 60,000 18,000 32,000 Rent expense Interest expense Income tax expense Depreciation expense 20,000 26,000 6,000 8,000 Loss on disposal of equipment 7,000 Gain on sale of long-term investments (12,000) Dividends 10,000 13,000 Profit 63,000 27,000 Non-Current Assets, at cost Land 257,000 500 70 Plant & Equipment 198,000 Accumulated Depreciation 61,000 60,000 25.000 Long-term Investments Current Assets Cash 41,000 36,000 Prepaid Asset - Rent 100 25,000 28,000 49,000 73,000 Accounts Receivable Inventory 102,000 114,000 80 41,000 57,000 Accounts Payable Interest Payable 20,500 22,000 Income Tax Payable 23,500 20,000 Wages Payable 25,000 24,000 Non-Current Liabilities Long-term loan 240,000 250,000 Issued Ordinary Capital 205,000 215,000 Retained Earnings 56,000 83,000 Note:Purchased land for $50,000 cash, sold long-term investments costing $8,000 for cash $20,000, and purchased plant during the year for $5,000. Required: (a) Prepare a Cash Flow Statement using the Direct Method (ignore GST implications). (b) Prepare a note of reconciliation for the oping activities using the indirect method. Current Liabilities 201 215 +