Question
Luke Corporation reported the following income statement in condensed for 2016: Sales $ 500,000 Cost of Goods Sold (280,000) Gross Profit Operating Expenses: Depreciation expense
Luke Corporation reported the following income statement in condensed for 2016:
Sales
$ 500,000
Cost of Goods Sold
(280,000)
Gross Profit Operating Expenses:
Depreciation expense
$ 15,000
220,000
Salaries Expense
13,000
Rent Expense
10,000
Insurance Expense
5,000
(43,000)
Income before taxes
$ 177,000
Income tax expense
(61,950)
Net Income
$ 115,050
During 2016, the following changes occurred in the company's current assets and current liabilities:
Cash $19,850
Account Receivable ($6,750)
Inventories $5,600
Accounts Payable ($2,800)
Salaries Payable ($1,750)
Required:
By visual the inspection method prepare the net cash flows from the operating activities using the following methods (note: headings arenotnecessary):
1)Indirectmethod
2)Directmethod
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