Determining Operating Cash Flows-Direct Method Adjusted trial balances for Garboz Company, an industrial recycler, at December 31 of the current and prior year follow. Debits, December 31 Current Year Prior Year Cash $49,000 $44,800 Accounts receivable 46,200 42,000 Inventory 43,400 65,800 Property, plant, and equipment 140,000 133,000 Discount on bonds payable 6,300 7,000 Cost of goods sold Selling expenses 350,000 532,000 198,100 240,800 General and administrative expenses 191,800 211,820 Interest expense 6,020 3,640 28,560 85,680 Income tax expense Total debits Allowance for doubtful accounts Accumulated depreciation $1,059,380 $1,366,540 Credits, December 31 Current Year Prior Year $ 1,820 $ 1,540 23,100 21,000 Trade accounts payable 35,000 24,500 Income taxes payable 29,400 37,940 Deferred income tax liability 7,420 6,440 Callable bonds payable, 8% 63,000 28,000 Common stock 70,000 56,000 Additional paid-in capital 12,740 10,500 Retained earnings 62,580 90,440 754,320 1,090,180 $1,059,380 $1,366,540 Sales Total credits Additional information 1. Purchased $7,000 of equipment in the current year. 2. Allocated one-third of its depreciation expense to selling expenses and the remainder to general and administrative expenses. 3. Assume no accounts receivable were written off or recovered during the year.