Reconciling the income statement, the direct method, and the indirect method
Battery Builders, Inc. prepared statements of cash flows under both the direct and indirect methods. The operating sections of each statement under the two methods follow:
|
DIRECT METHOD |
|
|
Collections from customers |
$26,000 |
|
Payments in suppliers |
(13,000) |
|
Payments for operating expenses |
(10,000) |
|
Cash provided (used i by operating activities |
$3,000 |
|
INDIRECT METHOD |
|
|
Net income |
$9,000 |
|
Depreciation |
3,000 |
|
Gain DT mile 4d equipment |
(2,000) |
|
Increase in inventory |
(3,000) |
|
Increase in accounts receivable |
(3,000) |
|
Increase to accounts payable |
1,000 |
|
Decrease in accrued payables |
(2,000) |
|
each provided fused, by operating activities |
$3,000 |
REQUIRED:
Prepare an income statement from the information provided.