EXPANDED STATEMENT OF CASH FLOWS Financial statements for McGinnis Company as well as additional information relevant to cash flows during the period are given below and on the next page.

Additional information:
1. Office equipment was sold in 20-2 for $35,000. Additional information on the office equipment sold is provided below.
Cost............$100,000
Accumulated depreciation....(80,000)
Book value...........$ 20,000
Market value...........35,000
Gain on sale.........$ 15,000
2. Depreciation expense for the year was $70,000.
3. The following purchases were made for cash:
Store equipment........$140,000
Delivery equipment........100,000
Office equipment.......32,000
..............$272,000
4. Declared and paid cash dividends of $40,000.
5. Issued 10,000 shares of $10 par common stock for $22 per share.
6. Acquired additional office equipment by issuing a note payable for $8,000.

REQUIRED
Prepare a statement of cash flows explaining the change in cash and cash equivalents for the year ended December 31,20-2.

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McGinnis Company Income Statement For Year Ended December 31, 20-2 $1750| 01 0 이00 890| 01 이 이 0 Net sales Cost of goods sold $ 860 0 0 0 00 590 6 0 0 00 $ 269 4 0 0 00 Gross profit Operating expenses Operating income Other revenues and expenses: $2기01 01 00 (7 50 00) Interest revenue Interest expense 16 9 50 00 $ 286 3 5 0 00 Gain on sale of office equipment 151 01 0 이 00 Income before taxes 951 01 0 이 00 Income tax experse $ 191 3 5 0 00 Net income McGinnis Company Statement of Retained Earnings For Year Ended December 31, 20-2 Retained earnings, January 1, 20-2 $320 000 00 $191 350 00 40 0 0 0 00 Net income Less dividends 151 3 50 00 Net ingease in retained earnings $471 350 00 Retained earnings, December 31, 20-2