1. Based on this information, compute cash flow from operating activities using the direct method. Assume Prepaid Expenses and Accrued Liabilities relate to office expenses.
2. What was the primary reason that Pizza International was able to report large positive cash flow from operations despite nearly having a net loss?

Pizza International, Inc., reported the following information (in thousands) Operating Activities Net Income Depreciation Increase in receivables Decrease in inventory Increase in prepaid expenses Decrease in accounts payable Increase in accrued liabilities Decrease in income taxes payable Payments on notes payable Cash paid for equipment $338 33,340 657 671 8,727 726 2,735 12,698 29,080 The following summarized income statement for Pizza International, Inc. (in thousands): $144,25:1 Revenues Cost of Sales Gross Profit Salary and Wages Expense Depreciation Office Expenses Net Income before Income Tax Expense Income Tax Expense Net Income 98,401 56,870 33,340 7,788 403 65 $338 Required 1. Based on this information, compute cash flow from operating activities using the direct method. Assume Prepaid Expenses and Accrued Liabilities relate to office expenses 2. What was the primary reason that Pizza International was able to report large positive cash flow from operations despite nearly having a net loss? Complete this question by entering your answers in the tabs below Required 1Required 2 Based on this information, compute cash flow from operating activities using the direct method. Assume Prepaid Expenses and Accrued Liabilities relate to office expenses. (Amounts to be deducted should be indicated with a minus sign. Enter your answers in thousands.) PIZZA INTERNATIONAL, INC Cash Flows from Operating Activities-Direct Method Cash Collected from Customers Cash Payments to Suppliers Cash Payments to Employees Cash Payments for Office Expenses ash Payments for Income Tax t Cash Provided by Operating Activities 0 Required 1 Required 2 >