The Dauve Company reported the following condensed income statement for 2007:

During 2007, the following changes occurred in the company's current assets and current liabilities:
Increase
(Decrease)
Cash .............$3,700
Accounts receivable ........(5,500)
Inventories ...........8,900
Accounts payable (purchases) ..(4,600)
Salaries payable ..........2,800
Required
1. By visual inspection, prepare the net cash flow from operating activities section of the Dauve Company's 2007 statement of cash flows using the indirect method.
2. By visual inspection, prepare the net cash flow from operating activities section of the Dauve Company's 2007 statement of cash flows using the directmethod.

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Sales Cost of goods sold Gross profit Operating expenses $100,000 (58,000) 42,000 8,000 12,000 Depreciation expense Salaries expense Income before income taxes Income tax expense Net income (20,000) 22,000 (6,600) $15,400