The account balances for the non cash current assets of Allen Company are as follows:

	2008	2009
Accounts Receivable	$45,000	$38,000
Inventory	40,000	50,000
Prepaid Insurance	21,000	17,000
Total Current Assets	$106,000	$105,000

Net income for 2009 is $35,000. Depreciation expense is $22,000. Assume that all sales and all purchases are on account.

A.) Prepare the Operating Activities section of the statement of cash flows, using the indirect method. Explain why cash flow from operating activities is more or less than the net income for the period.

B.) What additional information,ation do you need to prepare the Operating Activities section of the statement of cash flows using the direct method?

C.) Explain the usefulness of each method of managerial decision making.