Your friend knows you are studying accounting and has asked for assistance checking the formulas their accountant used to prepare the operating activities section of their business cash flow statement. The formulas provided are: 1. Cash paid for interest = Increase in interest payable + interest expense 2. Cash collected from sales = Decrease in accounts receivable - sales revenue 3. Cash paid for taxes = Decrease in taxes payable - income tax expense 4. Cash paid for inventory = Decrease in accounts payable + increase in inventory + COGS Which of the above formulas is correct? 2 3 4 None of the formulas are correct 1