Portions of the financial statements for Clear Transmissions Company are provided below. CLEAR TRANSMISSIONS COMPANY
Income Statement
For the Year Ended December 31, 2021 ($ in thousands)
Sales $ 2,160
Cost of goods sold 864
Gross margin 1,296
Salaries expense $ 388
Depreciation expense 250
Amortization expense 38
Interest expense 96
Loss on sale of cash equivalents 20 792
Income before taxes 504
Income tax expense 252
Net Income 252
CLEAR TRANSMISSIONS COMPANY
Selected Accounts from Comparative Balance Sheets
December 31, 2021 and 2020 ($ in 000s)
Year
2021 2020 Change
Cash 135 128 7
Accounts receivable 259 274 (15 )
Inventory 464 478 (14 )
Accounts payable 198 190 8
Salaries payable 106 114 (8)
Interest payable 54 48 6
Income tax payable 45 38 7
Required:
Prepare the cash flows from operating activities section of the statement of cash flows for Clear Transmissions Company using the indirect method. (Enter your answers in thousands (i. e., 5,000 should be entered as 5). Amounts to be deducted should be indicated with a minus sign.)

Clear Transmissions Company

Clear Transmissions Company

Statement of Cash Flows for the year ended December 31, 2021

Operating activities:            ($ in 000s)

Net Income                                 $252

Depreciation expense                 250

Amortization expense                   38  

Loss on sale of cash equivalents 20

Changes in working capital:

Accounts receivable                      15

Inventory                                        14

Accounts payable                           8

Salaries payable                            (8)

Interest payable                             6

Income tax payable                        7

Cash flow operations              $602

Explanation:

a) Data and Calculations:

CLEAR TRANSMISSIONS COMPANY

Income Statement

For the Year Ended December 31, 2021 ($ in thousands)

Sales                                                    $ 2,160

Cost of goods sold                                   864

Gross margin                                         1,296

Salaries expense                       $ 388

Depreciation expense                 250

Amortization expense                   38

Interest expense                           96

Loss on sale of cash equivalents 20     792

Income before taxes                              504

Income tax expense                              252

Net Income                                             252

CLEAR TRANSMISSIONS COMPANY

Selected Accounts from Comparative Balance Sheets

December 31, 2021 and 2020 ($ in 000s)

Year                                  2021    2020     Change

Cash                                  135       128             7

Accounts receivable       259       274          (15 )

Inventory                         464       478           (14 )

Accounts payable           198        190             8

Salaries payable             106         114            (8)

Interest payable              54          48             6

Income tax payable        45          38              7

was my answer wrong?