Sawada Trading Company's income statement and comparative statement of financial position appear as follows:

Additional information related to business activities during 2015:
1. All accounts payable pertain to inventory purchases, and accrued liabilities pertain to other operating expenses.
2. The original cost of the equipment sold was $43,000. New equipment was purchased and 5,000 common shares at $5 per share were issued as a partial payment.
3. Sawada declared and paid a dividend on December 30.
Requirements
1. Identify source and use of cash for each account in the statement of financial position.
2. Calculate the cash receipt from the sale of equipment and the cost of the new equipment, using T-accounts to show your calculations.
3. Prepare a statement of cash flows, using the indirect method.
4. Prepare the cash flow from operating activities section by using the direct method.

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Sawada Trading Company Income Statement For the Year Ended December 31, 2015 $420,000 (252,000) 168,000 Sales Revenue Cost of Goods Sold $25,500 52,000 65,000 Depreciation Expense – Equipment Salaries Expense Other Operating Expenses Interest Expense Loss on Sale of Equipment 12,000 9,500 164,000 Income Tax Expense Net Income (Loss) 1,600 $ 2,400 Sawada Trading Company Statement of Financial Position As of December 31 SOURCE/ 2015 2014 (USE) $ 7,600 20,200 25,600 3,600 170,000 (33,000) $194,000 $169,000 $ 9,200 Cash Accounts Receivable 13,400 22,000 4,400 Inventory Prepaid Expenses Equipment Accumulated Depreciation Total 148,000 (28,000) $ 21,600 $ 18,200 4,000 15,500 7,700 Accounts Payable Unearned Revenue 2,600 Salaries Payable Interest Payable Income Tax Payable 12,000 6,200 12,000 85,000 23,200 Common Shares 60,000 46,800 $194,000 $169,000 Retained Earnings 48,200 Total