Pang actvitis section of the statement of cash flows for 2002 using the hd rect method. E18-8 The income statement for Mel Gibson Company shows cost of goods sold $325,000 and operating expenses (exclusive of depreciation) $250,000. The comparative balance sheets for the year show that inventory increased $6,000, prepaid expenses decreased $6,000, accounts payable (merchandise suppliers) decreased $8,000, and accrued expenses payable increased $4,000. Instructions Using the direct method, compute (a) cash payments to suppliers and (b) cash payments for erating expenses