A)

B) Answer choices: direct method or indirect method.

Cash Flows from Operating Activities-Direct Method The income statement of Booker T Industries Inc for the current year ended June 30 is as follows: Sales Cost of goods sold Gross profit Operating expenses $520,260 295,400 $224,860 Depreciation expense $39,920 Other operating expenses 105,540 Tetal operating expenses Income before income tax Income tax expense Net income Changes in the balances of selected accounts from the beginsing to the end of the current year are as follows 145,460 $79,400 22,040 $57,360 Accounts receivable (net Inventories Prepaid expenses Accounts payable (merchandise credtors) Accrued expenses payable (operating expenses) Income tax payable (11,530) 4,020 (3,840) (8,200) 1,150 (2,750) a. Prepare the Cash Flows from Operating Activisies section of the statement of cash fows, using the direct method. Use the minus sign to indicate cash out nows, cash decreases in cash, or any negative adjustments. payments Check My Work 4 more Check My Work unes remaining Previous Next Accounts receivable (net) Inventories Prepaid expenses Accounts payable (merchandise creditors) Accrued expenses payable (operating expenses) Income tax payable (11,530) 4,020 (3,840) (8,200) 1,150 (2,750) a. Prepare the Cash Flows from Operating Activities section of the statement of cash flows, using the direct method. Use the minus sign to indicate cash out flows, cash payments, decreases in cash, or any negative adjustments Booker T Industries Inc Cash Flows froms Operating Activities Section For the year ended on June 30 Cash flows from operating activities: Net cash flow from operating activities b. Whet does the direct method show about a company's cash flows from operating activities that is not shown using the indirect method? With the Flows from Operatiog Activities section The the cash received less the cash payments is the net cash flow from operating activities. Individual cash receipts and payments ae reported in the Cash -acusts accrual-basis net income for revenues and expenses that do not involve the receipt or payment er cash t amve at cash flors trom operat ng talities