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.

Portions of the financial statements for Parnell Company are provided below. $ 890 11 $ 901 PARNELL COMPANY Income Statement For the Year Ended December 31, 2018 ($ in 2005) Revenues and gains: Sales Gain on sale of buildings Expenses and loss: Cost of goods sold Salaries Insurance Depreciation Interest expense Loss on sale of machinery Income before tax Income tax expense Net income $ 345 129 53 132 59 170 85 $ 85 PARNELL COMPANY Selected Accounts from Comparative Balance Sheets December 31, 2018 and 2017 ($ in 2005) Year 2018 2017 Cash $ 152 $ 91 Accounts receivable 342 207 Inventory 312 443 Prepaid insurance 57 106 Accounts payable 228 108 Salaries payable 120 Deferred income tax liability Bond discount 181 218 Change $ 61 135 (131) (49) 120 84 36 78 61 17 (37) Required T Required "2" 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 cash flows from operating activities Required 1 Required 2 Prepare the cash flows from operating activities section of the statement of cash flows for Parnell Company using the indirect 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: Adjustments for noncash effects: Changes in operating assets and liabilities