The following schedule relates the income statement with cash flows from operating activities, derived by both the direct and indirect methods, in the format illustrated by Illustration 2111 in the chapter. Some elements necessary to complete the schedule are missing.

Table Summary: Summary

Cash Flows from Operating Activities Income Statement Indirect Method Direct Method Net income $ ? Adjustments: Sales $300 Decrease in accounts receivable 6 Cash received from customers $ ? Gain on sale of equipment 24 Gain on sale of equipment (24) (Not reportedno cash effect) Increase in inventory (12) Cost of goods sold (?) Increase in accounts payable 18 Cash paid to suppliers (174) Salaries expense (42) ? in salaries payable 6 Cash paid to employees (36) Depreciation expense (9) Depreciation expense 9 Cash paid for depreciation ? Interest expense (?) Decrease in bond discount 3 Cash paid for interest (9) Insurance expense (21) Decrease in prepaid insurance 9 Cash paid for insurance (?) Loss on sale of land (6) Loss on sale of land 6 (Not reportedno cash effect) Income tax expense (27) Increase in income tax payable ? Cash paid for income taxes (21) Net Income $ ? Net cash flows from operating activities $ 54 Net cash flows from operating activities $ 54

Required:

Complete the schedule by determining each of the following missing elements:

1. Cash received from customers.

2. Cost of goods sold.

3. ? in salaries payable (Increase? Or decrease?).

4. Cash paid for depreciation.

5. Interest expense.

6. Cash paid for insurance.

7. Increase in income tax payable.

8. Net income.