Comparative financial statements for Weaver Company follow:

Weaver Company Comparative Balance Sheet at December 31
	This Year			Last Year
Assets
Cash	$	16		$	22
Accounts receivable		490			320
Inventory		165			210
Prepaid expenses		10			8
Total current assets		681			560
Property, plant, and equipment		630			520
Less accumulated depreciation		120			70
Net property, plant, and equipment		510			450
Long-term investments		13			42
Total assets	$	1,204		$	1,052
Liabilities and Stockholders' Equity
Accounts payable	$	340		$	260
Accrued liabilities		40			50
Income taxes payable		79			72
Total current liabilities		459			382
Bonds payable		295			220
Total liabilities		754			602
Common stock		321			400
Retained earnings		129			50
Total stockholders equity		450			450
Total liabilities and stockholders' equity	$	1,204		$	1,052

Weaver Company Income Statement For This Year Ended December 31
Sales					$	820
Cost of goods sold						460
Gross margin						360
Selling and administrative expenses						233
Net operating income						127
Nonoperating items:
Gain on sale of investments	$	9
Loss on sale of equipment		(6	)			3
Income before taxes						130
Income taxes						39
Net income					$	91

During this year, Weaver sold some equipment for $13 that had cost $43 and on which there was accumulated depreciation of $24. In addition, the company sold long-term investments for $38 that had cost $29 when purchased several years ago. Weaver paid a cash dividend this year and the company repurchased $79 of its own stock. This year Weaver did not retire any bonds.

Required:

1. Using the direct method, adjust the companys income statement for this year to a cash basis.

2. Using the information obtained in (1) above, along with an analysis of the remaining balance sheet accounts, prepare a statement of cash flows for this year.