Reference no: EM132643392
Below is information from the Biddle Company income statement and current assets and current liabilities from the balance sheet as of December 31, 2017 and 2018.
Biddle Company
Income Statement
For Year Ended December 31, 2018
Sales Revenue $142,200
Expenses
Cost of Goods Sold $57,000
Depreciation Expense $19,500
Salaries Expense $33,000
Rent Expense $10,500
Insurance Expense $5,300
Interest Expense $5,100
Utilities Expense $4,300
Net Income $7,500
Biddle Company
Selected Balance Sheets Accounts
At December 31 2018 2017
Accounts Receivable $7,100 $8,800
Inventory $3,480 $2,290
Accounts Payable $5,900 $7,600
Salaries Payable $1,180 $850
Utilities Payable $520 $310
Prepaid Insurance $410 $580
Prepaid Rent $520 $330
Questions
1. Make the cash flows from operating activities section of the company's 2018 statement of cash flows using the direct method.
2. Make the cash flows from operating activities section of the company's 2018 statement of cash flows using the indirect method.
3. Compare the two statements of cash flows and comment on the differences.