CRUZ, INC. Comparative Balance Sheets December 31, 2019 2019 2018 Assets Cash $ 69,200 $ 17,200 Accounts receivable, net 29,700 36,500 Inventory 62,200 68,500 Prepaid expenses 3,800 3,100 Total current assets 164,900 125,300 Furniture 76,600 87,800 Accum. depreciationFurniture (11,900 ) (6,700 ) Total assets $ 229,600 $ 206,400 Liabilities and Equity Accounts payable $ 10,800 $ 15,200 Wages payable 6,400 3,600 Income taxes payable 1,100 2,000 Total current liabilities 18,300 20,800 Notes payable (long-term) 22,700 53,100 Total liabilities 41,000 73,900 Equity Common stock, $5 par value 162,900 127,800 Retained earnings 25,700 4,700 Total liabilities and equity $ 229,600 $ 206,400 CRUZ, INC. Income Statement For Year Ended December 31, 2019 Sales $ 353,400 Cost of goods sold 227,500 Gross profit 125,900 Operating expenses Depreciation expense $ 27,200 Other expenses 64,500 91,700 Income before taxes 34,200 Income taxes expense 12,400 Net income $ 21,800

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.)