29 Dec P1. Cash Flows from Operating Activities: Direct M
P1. Cash Flows from Operating Activities: Direct MethodTanucci Clothing Store’s income statement follows.Tanucci Clothing Store Income StatementFor the Year Ended June 30, 2014Net sales $4,900,000Cost of goods sold:Beginning inventory $1,240,000Net cost of purchases 3,040,000Goods available for sale $4,280,000Ending inventory 1,400,000Cost of goods sold 2,880,000Gross margin $2,020,000Operating expenses:Sales and administrative salaries expense $1,112,000Other sales and administrative expenses 624,000Total operating expenses 1,736,000Income before income taxes $ 284,000Income taxes 78,000Net income $ 206,000? 1: Total operating activities:$548,000 inflows? 1: Total financing activities:$260,000 outflowsAdditional information: (a) other sales and administrative expenses include depreciation expense of $104,000 and amortization expense of $36,000; (b) accrued liabilities for salaries were $24,000 less than the previous year, and prepaid expenses were $40,000 more than the previous year; and (c) during the year accounts receivable (net) increased by $288,000, accounts payable increased by $228,000, and income taxes payable decreased by $14,400.REquIREDUsing the direct method, prepare a schedule of cash flows from operating activities.