Reven Corporation Prepares Its Statement of Cash Flows Using the Direct

Multiple Choice

Reven Corporation prepares its statement of cash flows using the direct method. Last year, Reven reported Income Tax Expense of $25,000. At the beginning of last year, Reven had a $5,000 balance in the Income Taxes Payable account. At the end of last year, Reven had a $9,000 balance in the account. On its statement of cash flows for last year, what amount should Reven have shown for its Income Tax Expense adjusted to a cash basis (i.e., income taxes paid) ?

A) $29,000
B) $21,000
C) $25,000
D) $4,000