Operating Cash Flows (Direct Method)

Calculate the cash flow in each of the following cases:

a.	Advertising expense	$173,600
	Prepaid advertising, January 1	30,800
	Prepaid advertising, December 31	42,000
	Cash paid for advertising:	Answer
b.	Income tax expense	$81,200
	Income tax payable, January 1	19,880
	Income tax payable, December 31	13,720
	Cash paid for income taxes:	Answer
c.	Cost of goods sold	$504,000
	Inventory, January 1	84,000
	Inventory, December 31	70,000
	Accounts payable, January 1	28,000
	Accounts payable, December 31	33,600
	Cash paid for merchandise purchased: