Question: Wabaunsee Corp. uses the direct method to prepare its statement of cash flows. Waubansee's trial balances at December 31, 2010 and 2009 are as follows.

Wabaunsee Corp. uses the direct method to prepare its statement of cash flows. Waubansee's trial balances at December 31, 2010 and 2009 are as follows.

Additional information:

1. Wabaunsee purchased $5,000 in equipment during 2010.

2. Wabaunsee allocated one-third of its depreciation expense to selling expenses and the remainder to general and administrative expenses.

3. Bad debt expense for 2010 was $5,000, and write-offs of uncollectible accounts totaled $3,800. Determine what amounts Wabaunsee should report in its statement of cash flows for the year ended December 31, 2010, for the following items.

1. Cash collected from customers.

3. Cash paid for interest.

2. Cash paid to suppliers.

4. Cash paid for income taxes.

5. Cash paid for selling expenses.

Debits Cash Accounts receivable Inventory Property, plant, & equipment Unamortized bond discount

Debits Cash Accounts receivable Inventory Property, plant, & equipment Unamortized bond discount Cost of goods sold Selling expenses General and administrative expenses Interest expense Income tax expense Credits Allowance for doubtful accounts Accumulated depreciation Trade accounts payable Income taxes payable Deferred income taxes 8% callable bonds payable Common stock Additional paid-in capital Retained earnings Sales December 31 2010 $ 35,000 33,000 31,000 100,000 4,500 250,000 141,500 137,000 4,300 20,400 $756,700 $ 1,300 16,500 25,000 21,000 5,300 45,000 50,000 9,100 44,700 538,800 $756,700 2009 $ 32,000 30,000 47,000 95,000 5,000 380,000 172,000 151,300 2,600 61,200 $976,100 $1,100 13,500 17,000 29,100 4,600 20,000 40,000 7,500 64,600 778,700 $976,100

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