CALCULATION OF OPERATING CASH FLOW USING; THE DIRECT METHOD.

GAMAL INC. Income Statement For Year Ended June 30, 2015 GAMAL INC Comparative Balance Sheets June 30, 2015 and 2014 2015 2014 $678,000 411,000 267.000 Sales Cout of goods sold Gross profil Operating expenses. Depreciation expense Other expenses Total operating expenses. $58,600 67.000 Assets Cash Accounts receivable, net Inventory. Prepaid expenses.. Total current assets Equipment Accum, depreciation Equipment... Total assets... $ 87,500 65,000 63,800 4,400 220,700 124,000 (27.000) $317.700 $ 44,000 51,000 86,500 5,400 186.900 115,000 19.000) $292.900 125.600 141.400 *** ***** Other gain posses) Gain on sale of equipment Income before taxes Income taxes expense Net income 2.000 143.400 43,890 $ 99,510 Liabilities and Equity Accounts payable Wages payable. Income taxes payable Total current liabilities Notes payable fong term) Total liabilities $ 25,000 6,000 3,400 34,400 30,000 64,400 $ 30,000 15,000 3,800 48,800 60.000 108.800 Equity Common stock, 55 par value. Retained earnings Total liabilities and equity 220,000 33,300 $317,700 160.000 24.100 $292.900 a. A $30,000 note payable is retired at its $30,000 carrying (book) value in exchange for cash. b. The only changes affecting retained carnings are not income and cash dividends paid. c. New cquipment is acquired for $57,600 cash. d. Received cash for the sale of equipment that had cost $48,600. yielding a $2,000 gain. e. Prepaid Expenses and Wages Payable relate to Other Expenses on the income statement. 1. All purchases and sales of inventory are on credit