The following accounts and corresponding balances were drawnfrom Thornton Company’s Year 2 and Year...

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Accounting

The following accounts and corresponding balances were drawnfrom Thornton Company’s Year 2 and Year 1 year-end balancesheets.
Account Title Year 2 Year 1
Accounts receivable $ 73,700 $ 80,300
Prepaid rent 520 930
Utilities payable 1,790 1,020
Other operating expenses payable 31,400 34,400
The Year 2 income statement is shown as follows.
Income Statement
Sales $ 297,000
Rent expense (23,000 )
Utilities expense (35,800 )
Other operating expenses (166,400 )
Net Income $ 71,800
Required
Prepare the operating activities section of the statement ofcash flows using the direct method.
Prepare the operating activities section of the statement ofcash flows using the indirect method.

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In: AccountingThe following accounts and corresponding balances were drawnfrom Thornton Company’s Year 2 and Year 1...The following accounts and corresponding balances were drawnfrom Thornton Company’s Year 2 and Year 1 year-end balancesheets.Account TitleYear 2Year 1Accounts receivable$73,700$80,300Prepaid rent520930Utilities payable1,7901,020Other operating expenses payable31,40034,400The Year 2 income statement is shown as follows.Income StatementSales$297,000Rent expense(23,000)Utilities expense(35,800)Other operating expenses(166,400)Net Income$71,800RequiredPrepare the operating activities section of the statement ofcash flows using the direct method.Prepare the operating activities section of the statement ofcash flows using the indirect method.

Account Title	Year 2		Year 1
Accounts receivable	$	73,700	$	80,300
Prepaid rent		520		930
Utilities payable		1,790		1,020
Other operating expenses payable		31,400		34,400

Income Statement
Sales	$	297,000
Rent expense		(23,000	)
Utilities expense		(35,800	)
Other operating expenses		(166,400	)
Net Income	$	71,800