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Cash Flows from (Used for) Operating Activities -- Direct Method The income statement of Booker T Industries Inc. for the current year ended June 30 is as follows: Sales $511,000 Cost of merchandise sold 290,500 Gross profit $220,500 Operating expenses: Depreciation expense $39,200 Other operating expenses 105,000 Total operating expenses 144,200 Income before income tax $75,300 Income tax expense 21,700 Net income $54,600 Changes in the balances of selected accounts from the beginning to the end of the current year are as follows: Increase Decrease Accounts receivable (net) $(11,760) Inventories 3,920 Prepaid expenses (3,780) Increase Decrease Accounts receivable (net) Inventories Prepaid expenses Accounts payable (merchandise creditors) Accrued expenses payable (operating expenses) Income tax payable $(11.760) 3,920 (3,780) (7,980) 1,260 (2.660) a. Prepare the Cash Flows from (used for) Operating Activities section of the statement of cash flows, using the direct method One the minus sian to indicate cash outflows, cash payments, decreases in cash, or any negative adjustments. Booker T Industries Inc. Cash Flows from Operating Activities Section For the year ended on June 30 Cash flows from (used for operating activities: Net cash flow from operating activities b. What does the direct method show about compan's cash flows from pertinactivities that is not shown using the Indirect method

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