Ayayai Inc. is a major retailer of road bicycles and a promoter of riding bicycles to work, both to save the environment and improve physical fitness. Financial statements for Ayayai are presented below. STATEMENT OF FINANCIAL POSITION December 31 Current Assets 2021 2020 Cash 56,100 20,850 Accounts receivable 24,900 10,250 Inventory 31,150 16,150 Prepaid expenses 15,250 10,250 Total current assets 127,400 57,500 Property and Equipment Property and equipment 161,000 151,000 Less: Accumulated depreciation 78,900 70,000 Net property and equipment 82,100 81,000 TOTAL ASSETS $209,500 $138,500 Current Liabilities Accounts payable 11,700 15,600 Salaries payable 10,250 8,250 Interest payable 2,250 3,250 Total current liabilities 24,200 27,100 Loan payable 101,000 61,000 Total Liabilities 125,200 88,100 Shareholders' Equity Common shares 10,500 1,050 Retained earnings 73,800 49,350 Total shareholders' equity 84,300 50,400 TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $209,500 $138,500 INCOME STATEMENT For the Years Ended December 31 2021 2020 Sales revenue 613,000 500,000 Cost of sales 419,000 350,000 Gross margin 194,000 150,000 Expenses Salary expense 136,000 125,000 Interest expense 3,500 2,400 Other expenses 6,000 3,000 Depreciation expense 14,900 8,000 Total expenses 160,400 138,400 Operating income 33,600 11,600 Gain on disposal of equipment 2,000 Income tax expense 6,400 1,972 Net income $29,200 $9,628 The following is additional information concerning Ayayai's transactions during the year ended December 31, 2021: C Equipment costing $40,000 was purchased by paying $34,700 cash and issuing 100 shares. . Equipment costing $30,000 that was purchased at the beginning of 2020 was sold at the end of 2021 for $26,000. Straight- line depreciation had been used with an expected asset life of 10 years and a residual value of $0. . The "other expenses" relate to prepaid items. In order to supplement its cash, Ayayai borrowed an additional $40,000. . Cash dividends of $4,750 were paid at the end of the fiscal year. Cost of sales includes $135,000 of direct labour costs. Prepare a statement of cash flows for Ayayai for the year ended December 31, 2021, using the direct method. Ayayai follows ASPE. Include any note disclosure on non-cash financing and investing transactions. (Show amounts that decrease cash flow with either a-sign e.g.-15,000 or in parenthesis e.g. (15,000).) Ayayai, Inc. Statement of Cash Flows For the Year Ended December 31, 2021 > > > > > > >