$(2)$ all credits to Accounts Receivable reflect cash receipts from customers,

$(3)$ all purchases of inventory are on credit,

$(4)$ all debits to Accounts Payable reflect cash payments for inventory, and

$(5)$ any change in Income Taxes Payable reflects the accrual and cash payment of taxes.

Additional Information on Current Year Transactions

a$.$ Purchased equipment for $$37,600$ cash.

b$.$ Issued $12,100$ shares of common stock for $$5$ cash per share. c$.$ declared and paid $90000$ in cash dividends. Prepare a statement of cash flows under the direct method