For the just completed year, Hanna Company had net income of $161,000. Balances in the companys current asset and current liability accounts at the beginning and end of the year were as follows:

	December 31
	End of Year		Beginning of Year
Current assets:
Cash and cash equivalents	$	62,000	$	81,000
Accounts receivable	$	168,000	$	196,000
Inventory	$	423,000	$	361,000
Prepaid expenses	$	12,500	$	13,900
Current liabilities:
Accounts payable	$	370,000	$	394,000
Accrued liabilities	$	8,800	$	11,400
Income taxes payable	$	34,400	$	28,000

The Accumulated Depreciation account had total credits of $56,000 during the year. Hanna Company did not record any gains or losses during the year.

The companys income statement for the year appears below:

Sales	$	1,070,000
Cost of goods sold		570,000
Gross margin		500,000
Selling and administrative expenses		300,000
Income before taxes		200,000
Income taxes		39,000
Net income	$	161,000

Required:

Using the direct method, convert the company's income statement to a cash basis. (Adjustment amounts that are to be deducted should be indicated with a minus sign.)