Portions of the financial statements for Parnell Company are provided below.

PARNELL COMPANY Income Statement For the Year Ended December 31, 2018 ($ in 000s)
Revenues and gains:
Sales	$	850
Gain on sale of buildings		10		$	860
Expenses and loss:
Cost of goods sold	$	325
Salaries		125
Insurance		45
Depreciation		128
Interest expense		55
Loss on sale of machinery		12			690
Income before tax					170
Income tax expense					85
Net income				$	85

PARNELL COMPANY Selected Accounts from Comparative Balance Sheets December 31, 2018 and 2017 ($ in 000s)
	Year
		2018			2017		Change
Cash	$	144		$	95		$	49
Accounts receivable		334			211			123
Inventory		316			435			(119	)
Prepaid insurance		61			98			(37	)
Accounts payable		220			112			108
Salaries payable		112			88			24
Deferred income tax liability		70			57			13
Bond discount		185			210			(25	)

Required:

1. Prepare the cash flows from operating activities section of the statement of cash flows for Parnell Company using the direct method. 2. Prepare the cash flows from operating activities section of the statement of cash flows for Parnell Company using the indirect method.

Prepare the cash flows from operating activities section of the statement of cash flows for Parnell Company using the direct method. (Enter your answers in thousands (i.e., 5,000 should be entered as 5). Amounts to be deducted should be indicated with a minus sign.) Cash Flows from Operating Activities: Net income Adjustments for noncash effects: \begin{tabular}{|l|l|l|} \hline Increase in accounts receivable & & \\ \hline Decrease in inventory & & \\ \hline Decrease in prepaid insurance & & \\ \hline Increase in accounts payable & \\ \hline Changes in operating assets and liabilities: & \\ \hline & \\ \hline & & \\ \hline & $ \\ \hline \end{tabular}