The income statement and a schedule reconciling cash flows from operating activities to net income are provided below ($ in 000s) for Peach Computers.
Sales $305 Net income $22 Cost of goods sold (185) Adjustments for Noncash Effects Gross margin 120 Depreciation expense 11 Salaries expense $41 Loss on sale of land 5 Insurance expense 19 Changes in operating assets and liabilities: Depreciation expense Loss on sale of land 11 Decrease in accounts receivable 6 5 76 Increase in inventory (13) Decrease in accounts payable (8) Income before tax 44 Increase in salaries payable 5 Income tax expense (22) Decrease in prepaid insurance 9 $ 22 Increase in income tax payable 20 Net income - Net cash flows from operating activities $57
1. Calculate each of the following amounts for Peach Computers:
a. Cash received from customers during the reporting period.
b. Cash paid to suppliers of goods during the reporting period.
c. Cash paid to employees during the reporting period.
d. Cash paid for insurance during the reporting period.
e. Cash paid for income taxes during the reporting period.
2. Prepare the cash flows from operating activities section of the statement of cash flows (direct method).