Portions of the financial statements for Parnell Company are provided below. 

Required: 

1. Prepare the cash flows from operating activities section of the statement of cash flows for Parnell Company using the direct method. 

2. Prepare the cash flows from operating activities section of the statement of cash flows for Parnell Company using the indirect method.

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PARNELL COMPANY Income Statement For the Year Ended December 31, 2021 ($ in thousands) Revenues and gains: Sales $800 Gain on sale of building 11 $811 Expenses and loss: Cost of goods sold 300 Salaries 120 Insurance 40 Depreciation 123 Interest expense 50 Loss on sale of equipment 12 645 Income before tax 166 Income tax expense 78 Net income $ 88