Ravenna Company is a merchandiser that uses the indirect method to prepare the operating activities section of its statement of cash flows. Its balance sheet for this year is as follows:

	Ending Balance		Beginning Balance
Cash	$	97,200	$	116,700
Accounts receivable		77,600		83,600
Inventory		104,200		95,000
Total current assets		279,000		295,300
Property, plant, and equipment		276,000		266,000
Less accumulated depreciation		92,000		66,500
Net property, plant, and equipment		184,000		199,500
Total assets	$	463,000	$	494,800
Accounts payable	$	60,800	$	108,000
Income taxes payable		47,200		62,800
Bonds payable		114,000		95,000
Common stock		133,000		114,000
Retained earnings		108,000		115,000
Total liabilities and stockholders equity	$	463,000	$	494,800

During the year, Ravenna paid a $11,400 cash dividend and it sold a piece of equipment for $5,700 that had originally cost $13,200 and had accumulated depreciation of $8,800. The company did not retire any bonds or repurchase any of its own common stock during the year.

6a. If the company debited cost of goods sold and credited inventory for $760,000 during the year, what is the total amount of inventory purchases recorded on the debit side of the Inventory T-account and the credit side of the Accounts Payable T-account?

6b.What is the total amount of the debits recorded in the Accounts Payable T-account during the year?

7. What is the combined amount and direction (+ or ) of the inventory and accounts payable adjustments to net income in the operating activities section of the statement of cash flows?

8. If the company debited income tax expense and credited income taxes payable $1,420 during the year, what is the total amount of the debits recorded in the Income Taxes Payable account?

9. What is the amount and direction (+ or ) of the income taxes payable adjustment to net income in the operating activities section of the statement of cash flows?

10. Would the operating activities section of the companys statement of cash flows contain an adjustment for a gain or a loss? What would be the amount and effect of the adjustment?