For the just completed year, Hanna Company had net income of $126,000. 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	$	61,000	$	82,000
Accounts receivable	$	158,000	$	198,000
Inventory	$	450,000	$	346,000
Prepaid expenses	$	12,300	$	14,800
Current liabilities:
Accounts payable	$	352,000	$	390,000
Accrued liabilities	$	8,000	$	12,400
Income taxes payable	$	35,000	$	28,000

The Accumulated Depreciation account had total credits of $52,000 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		590,000
Gross margin		480,000
Selling and administrative expenses		316,000
Income before taxes		164,000
Income taxes		38,000
Net income	$	126,000

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.)