Required information Use the following information for the Quick Study below. (Algo) [The following information applies to the questions displayed below.) A comparative balance sheet and income statement is shown for Cruz, Incorporated. 2020 CRUZ, INCORPORATED Comparative Balance Sheets At December 31 2021 Assets Cash $ 75,900 Accounts receivable, net 32,600 Inventory 68,300 Prepaid expenses 4,200 Total current assets 181,000 Furniture 84,600 Accumulated depreciation-Furniture (13,100) Total assets $ 252,500 Liabilities and Equity Accounts payable $ 11,900 Wages payable 7,100 Income taxes payable 1,200 Total current liabilities 20,200 Notes payable (long-term) 24,800 Total liabilities 45,000 Equity Common stock, $5 par value 177,300 Retained earnings 30,200 Total liabilities and equity $ 252,500 $ 18,900 40,100 75,300 3,500 137,800 99,200 (7,500) $ 229,500 $ 16,900 4,000 2,200 23,100 58,400 81,500 141,500 6,500 $ 229,500 CRUZ, INCORPORATED Income Statement For Year Ended December 31, 2021 Sales Cost of goods sold Gross profit Operating expenses (excluding depreciation) Depreciation expense Income before taxes Income taxes expense Net income $ 392,900 252,900 140,000 71,600 30,200 38,200 13,900 $ 24,300 5 QS 12-27B (Algo) Direct: Computing operating cash outflows L P5 1. How much cash is paid to acquire inventory during year 2021? 2. How much cash is paid for operating expenses (excluding depreciation) during year 2021? Hint: Examine prepaid expenses and wages payable. 1. Cash paid for inventory 2. Cash paid for operating expenses QS 12-28B (Algo) Direct: Computing cash from operations LO P5 Use the above balance sheet and income statement to prepare the operating activities section by direct method. Assume all the sales were made on credit basis. (Amounts to be deducted should be indicated with a minus sign.) Cash flows from operating activities