2 Required information [The following information applies to the questions displayed below.] A comparative balance sheet and income statement is shown for Cruz, Incorporated. CRUZ, INCORPORATED Comparative Balance Sheets At December 31 Assets Cash Accounts receivable, net 37 Prepaid expenses 2021 2020 $ 85,600 $ 21,300 36,800 45,200 Inventory Total current assets Furniture Accumulated depreciation-Furniture Total assets Liabilities and Equity Accounts payable Wages payable 77,100 84,900 4,700 3,900 204,200 155,300 94,700 110,500 (14,700) (8,400) $ 284,200 $ 257,400 $ 13,400 $ 19,000 8,000 4,500 Income taxes payable 1,400 2,500 Total current liabilities Notes payable (long-term) Total liabilities Equity Common stock, $5 par value 22,800 26,000 28,900 66,400 51,700 92,400 204,000 Retained earnings 28,500 162,300 2,700 Total liabilities and equity $ 284,200 $ 257,400 CRUZ, INCORPORATED Income Statement For Year Ended December 31, 2021 Sales Cost of goods sold Gross profit Operating expenses (excluding depreciation) Depreciation expense Income before taxes Income taxes expense Net income $ 440,700 283,700 157,000 80,400 33,900 42,700 15,500 $ 27,200 Use the above balance sheet and income statement to prepare the operating activities section by direct method. Assume all the sales were made on credit basis. (Amounts to be deducted should be indicated with a minus sign.) Cash flows from operating activities $ 0