Using the information provided below, prepare a complete statement of cash flows - using the DIRECT METHOD - prepare the Operating Section ONLY.

INSTRUCTIONS PART 1: Using the information provided below, prepare a complete statement of cash flows: reports its operating activities using the direct method. Disclose any noncash investing and financing activies in a note (Adapted from PR16-1B and PR16-3B) Gazele Corporation, a merchandiser, recently completed its calendar-year 2013 operations. For the year, (1) all sales are credit sales, (2) ali credits to Accounts Receivable refect cash receipts from customers, (3) all purchases of inventory are on credit (4) all debits to Accounts Payable reflect cash payments for inventory, and (5) Other Expenses are paid in advance and are initially debiled to Prepaid Expenses. The company's balance sheets and income statement folow. CAZELLE CORPORATION Comparative Balanco Shacts Additional Information on Year 2013 Transactions: December 31.2013 and 2012 a) Equipment was sold for cash. 2013 2012 b) Purchased equipment costing $113,250 by paying Assets $43,250 cash and signing a long-term note Cash $123450 550 payable for the balance Accounts receivable 80,750 c) The increase in short-term notes payable is the Merchandi 240.600 250.700 result of borrowing cash. Prepaid expenses 17,000 d) Any reduction in notes payable resulted from a cash payment to reduce the notes payable. Equipment 262,250 200,000 e) Issued 3,000 shares of common stock for cash. Accum. Total assets $607,750 $SIS,000 Liabilities and Equity operating Accounts payable 17750 $102,000 Short-term notes payable Payable 00,000 77,500 Common stock par 215.000 200,000 Paid-in capital in excass of par common stock 30000 Section Rekaned eamings 230000 Total liabilities and equity 4607,750 $515.000 GAZELLE CORPORATION only ncene Statement For Year Ended Dacembar 31, 2013 $1,185.000 Cost of goods sold 595,000 Gross pronu 590.000 oporating expenses Depreciation exp 20,600 362850 Total oporating expensat 401,450 88 550 Other gains (losses) Loss on sale of equipment Income before uxes 86450 Income taxes expeme 28,350 Net inconve 159,000