Statement of Cash Flows (Direct Method) Dair Company's income statement and comparative balance sheets follow. DAIR COMPANY Income Statement For Year Ended December 31,2011 Sales $700,000 Cost of goods sold $ 440,000 Wages and other operating expenses 95,000 Depreciation expense 21,000 Amortization expense 6,000 10,000 Income tax expense 36,000 Loss on bond retirement 5,000 613,000 Net income $87,000 Interest expense Statement of Cash Flows (Direct Method) Dair Company's income statement and comparative balance sheets follow. DAIR COMPANY Income Statement For Year Ended December 31,2011 Sales $700,000 Cost of goods sold $ 440,000 Wages and other operating expenses 95,000 Depreciation expense 21,000 Amortization expense 6,000 10,000 Income tax expense 36,000 Loss on bond retirement 5,000 613,000 Net income $87,000 Interest expense