Determining Operating Cash Flows-Direct Method Sterling Corporation's recent comparative balance sheet and income statement follow. Balance Sheets, December 31 2019 2020 Difference Assets Cash and cash equivalents $ 34,000 $ 33,500 $ (500) Accounts receivable (net) 12,000 17,000 5,000 Inventory 16,000 14,000 (2,000) Investment, long-term 6,000 (6,000) Fixed assets 80,000 98,000 18,000 Accumulated depreciation (48,000) (39,000) 9,000 Total assets $100,000 $123,500 $23,500 Liabilities and Stockholders' Equity Accounts payable 19,000 12,000 (7,000) Bonds payable 10,000 30,000 Common stock, no-par 50,000 65,000 15,000 Retained earnings 21,000 28,000 7,000 Treasury stock (11,500) (11,500) Total liabilities and stockholders' equity $100,000 $123,500 $23,500 Income Statement, For Year Ended December 31 2020 Sales revenue $70,000 Cost of goods sold (42,000) Gross margin 28,000 Depreciation expense (5,000) Other operating expenses (18,000) Gain on sale of investments 3,000 Loss on sale of fixed assets (1,000) Net income $7,000 20,000 Analysis of selected accounts and transactions 1. Sold fixed assets for cash; cost, $21,000, and two-thirds depreciated. 2. Purchased fixed assets for cash, $9,000. 3. Purchased fixed assets; exchanged unissued bonds of $30,000 (face value and fair value) in payment. 4. Sold the long-term investments for $9,000 cash. Assume carrying value of the investment is equal to its original purchase price. 5. Purchased treasury stock for cash, $11,500. 6. Retired bonds payable at maturity date by issuing common stock, $10,000. 7. Sold unissued common stock for cash, $5,000. Required Prepare the operating activities section of the statement of cash flows, using the direct method. Assume there is no bad debt expense. Note: Use negative signs with amounts for cash outflows. Cash Flows from Operating Activities Collections from customers Payments to suppliers Other operating expenses Net cash provided (used) by operating activities $ 0 0 0 0