For the just completed year, Hanna Company had net income of $168,000. Balances in the company's current asset and current liability accounts at the beginning and end of the year were as follows: December 31 End of Beginning Year of Year Current assets: Cash and cash equivalents Accounts receivable Inventory Prepaid expenses Current liabilities: Accounts payable Accrued liabilities Income taxes payable $ 61,000 $ 160,000 $ 429,000 $ 12,300 $ 81,000 $ 194,000 $ 367,000 $ 14,100 $ 362,000 $ 7,300 $ 38,600 $ 380,000 $ 12,400 $ 33,000 The Accumulated Depreciation account had total credits of $42,000 during the year. Hanna Company did not record any gains or losses during the year. The company's income statement for the year appears below: Sales Cost of goods sold Gross margin Selling and administrative expenses Income before taxes Income taxes Net income $1,100,000 575,000 525,000 314,000 211,000 43,000 $ 168,000 The Accumulated Depreciation account had total credits of $42,000 during the year. Hanna Company did not record any gains or losses during the year. The company's income statement for the year appears below: Sales Cost of goods sold Gross margin Selling and administrative expenses Income before taxes Income taxes Net income $1,100,000 575,000 525,000 314,000 211,000 43,000 168,000 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.) Hanna Company Direct Method of Determining the Net Cash Flows from Operating Activities Adjustments to a cash basis: Adjustments to a cash basis: Selling and administrative expenses Adjustments to a cash basis: Income taxes Adjustments to a cash basis