Reference no: EM132771596

The income statement of Jetty Inc. for the year ended December 31, 2005, reported the following condensed information:

Revenue from fees $ 600,000
Operating expenses $ 360,000
Income from Operations $ 240,000
Income Tax Expense $ 60,000
Net Income $ 180,000

Jetty's balance sheet contained the following comparative data at December 31:

Jetty has no depreciable assets. Accounts payable pertains to operating expenses.

                                      2005                  2004
Accounts Receivable $ 50,000           $ 65,000
Accounts Payable $ 37,000              $ 41,000
Income Taxes Payable $ 6,000           $ 3,000

Problem 1: Prepare operating activities section of the statement of cash flows using the direct method.