Bad Debts; Direct Method versis Indirect Method

(a) Prepare the Operating Activities section of the statement of cash flows using the direct method.

(b) Prepare the Operating Actvities section of the statement of cash flows using the indirect method.

Ending Balances eginning Balances s receivable $9,500 13,000 nt Allowance for bad debts 3,100 3,000 Sales for the ear 75,000 Net income for the year 20,000 Bad debt expense for the year 2,000 Write-off of uncollectible amounts for the year 1,900 53,000 Cash expenses for the year