The following schedule relates the income statement with cash flows from operating activities, derived by both the direct and indirect methods, in the format illustrated by Illustration 21–11 in the chapter. The amounts for income statement elements are missing.

Required:
Deduce the missing amounts and prepare the income statement.

Transcribed Image Text:

$? ? ~~~.~.~. ? Net income Adjustments: Decrease in accounts receivable Increase in inventory Decrease in accounts payable Increase in salaries payable ? Depreciation expense Decrease in prepaid insurance ? Loss on sale of land ? Increase in income tax payable $? Net cash flows from operating activities ? Cash Flows from Operating Activities Indirect Method $ ? 12 (24) (36) 12 18 18 12 12 $ 60 Direct Method Cash received from customers Cash paid to suppliers Cash paid to employees (Not reported-no cash effect) Cash paid for insurance (Not reported-no cash effect) Cash paid for income taxes Net cash flows from operating activities $ 612 (420) (66) (24) (42) $ 60