The income statement for Javier Company showed cost of goods sold of $85,000 and operating expenses of $55,000. The comparative balance sheets for the year show that inventory decreased $3,000, prepaid expenses increased $7,000, accounts payable increased $4,000, and accrued expenses payable decreased $5,000.
Instructions
Compute (a) cash payments to suppliers and (b) cash payments for operating expenses using the direct method.

Question

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The Answer of The income statement for Javier Company showed cost of goods sold of $85,000 and operating expenses of $55,000. The comparative balance sheets for the year show that inventory decreased $3,000, prepaid expenses increased $7,000, accounts payable increased $4,000, and accrued expenses payable decreased $5,000.
Instructions
Compute (a) cash payments to suppliers and (b) cash payments for operating expenses using the direct method.

The Income Statement for Javier Company Showed Cost of Goods