Answer Happy

Whispering Company’s income statement for the year ended
December 31, 2020, contained the following condensed
information.
Service revenue
$844,000
Operating expenses (excluding depreciation)
$628,000
Depreciation expense
60,000
Loss on sale of equipment
26,000
714,000
Income before income taxes
130,000
Income tax expense
40,000
Net income
$90,000
Whispering’s balance sheet contained the following comparative data
at December 31.
2020
2019
Accounts receivable
Accounts payable
Income taxes payable
(Accounts payable pertains to operating expenses.)

- Prepare the operating activities section of the statement
of cash flows using the direct method.