Zena Company€™s accountants just completed the financial statements for the year and have provided the following information (in thousands):

In addition, the company signed long- term notes for $ 20,000 during the year.
Required:
1. Prepare the operating activities section of the statement of cash flows for 2014 by using the indirect method.
2. As a financial analyst, would you prefer to see the cash flow from operations reported using the direct method or the indirect method? Justify your answer.
3. As the accountant who prepares the company€™s statement of cash flows, would you prefer to use the direct or the indirect method to report the cash flow from operations? Explain.

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Statement of Earnings for 2014 Sales revenue Expenses and losses: $20,600 $9,000 2,000 5,000 2,500 Cost of sales Salaries Insurance Utilities Interest 700 Net eamings Selected Statement of Financial Position Accounts 2013 2014 S 82 Merchandise inventory Trade receivables Trade payables Salaries payable Rent payable Prepaid rent Prepaid insuranoe 9