Current Year Previous Year Balance Sheet at December 31 Cash Accounts Receivable Equipment Accumulated Depreciation-Equipment Total Assets Accounts Payable Salaries and Wages Payable Notes Payable (long-term) Common Stock Retained Earnings Total Liabilities and Stockholders' Equity Income Statement Service Revenue Salaries and Wages Expense Depreciation Expense Income Tax Expense Net Income $ 13,520 2,100 11,000 (2,780) $ 23,840 $ 1,300 920 2,800 10,000 $ 7,500 3,300 10,000 (2,300) $ 18,500 $ 1,800 1,400 1,000 10,000 8,820 4,300 $ 23,840 $ 18,500 $ 73,800 67,000 480 1,800 $ 4,520 Additional Data: a. Bought new golf clubs using cash, $1,000. b. Borrowed $1,800 cash from the bank during the year. c. Accounts Payable includes only purchases of services made on credit for operating purposes. Because there are no liability accounts relating to income tax, assume that Income Tax Expense was fully paid in cash. Required: 1. Prepare the statement of cash flows for the current year ended December 31 using the direct method. TIP: Remember to exclude depreciation expense when converting to the cash basis. (Amounts to be deducted should be indicated with a minus sian.)