The following income statement and selected balance sheet account de ment and selected balance sheet account data are available for Trecce. Inc., at December 31, 2015: 1.3.2013.8 OLEN 13.44 ing Operating Cash by the Direct Method TREECE, INC. INCOME STATEMENT FOR THE YEAR ENDED DECEMBER 31, 2015 Revenue: Net sales .......... Dividend Income .. Interest income ......... Gain on sales of marketable securities ... Total revenue and gains Costs and expenses: Cost of goods sold ... $1,550,000 Operating expenses... 980,000 Interest expense ....... 185,000 Income tax expense ............. 90,000 Total costs and expenses .... Net income $2,850,000 104,000 70,000 4,000 $3,028,000 2,805,000 $ 223,000 End of Year Beginning of Year Selected account balances: Accounts receivable .............................. $ Accrued interest receivable . . . . . . . . . . . . . . . .......... Inventories .......... Short-term prepayments . . . . . . . . . . . . . . . . . . . . . ...... Accounts payable (merchandise suppliers) ............. Accrued operating expenses payable ............. Accrued interest payable Accrued income taxes payable ............ 650,000 9,000 800,000 20,000 570,000 65,000 21,000 22,000 $ 720,000 6,000 765,000 15,000 562,000 94,000 12,000 35,000 Chapter 13 Statement of Cash Flows Pro come statement amounts to Additional Information 1. Dividend revenue is recognized on the cash basis. All other income sta recognized on the accrual basis. 2. Operating expenses include depreciation expense of $115,000. operating activities section of the numbers representing cash per Instructions a. Prepare a partial statement of cash flows, including only the operating activiti statement and using the direct method. Place brackets around numbers represent ments. Show supporting computations for the following: 1. Cash received from customers. 2. Interest and dividends received. 3. Cash paid to suppliers and employees. 4. Interest paid. 5. Income taxes paid. b. Management of Treece, Inc., is exploring ways to increase the cash flows from operations. One way that cash flows could be increased is through more aggressive collection of receivables Assuming that management has already taken all the steps possible to increase revenue and reduce expenses, describe two other ways that cash flows from operations could be increasel