E23-5 (Preparation of Operating Activities Section-Direct Method) Krauss Company's income state- ment for the year ended December 31, 2014, contained the following condensed information $840,000 Service revenue Operating expenses (excluding depreciation) Depreciation expense Loss on sale of equipment Income before income taxes Income tax expense Net income $624,000 60,000 26,000 710,000 130,000 40,000 $ 90,000