Heads Up Company was started several years ago by two hockey instructors. The company's comparative balance sheets and income statement follow, along with additional information. 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 $ 12,100 $ 620 420 1,600 5,800 3,660 Current Year Previous Year $ 6,240 $ 4,520 980 6,460 (1,580) 1,910 5,800 (1,330) $ 10,900 $ 1,200 750 500 5,800 2,650 Total Liabilities and Stockholders' Equity $ 12,100 $ 10,900 Income Statement Service Revenue $ 39,100 Salaries and Wages Expense Depreciation Expense Loss on Disposal of Equipment Income Tax Expense Net Income Additional Data: 36,600 580 630 280 $ 1,010 a. Bought new equipment for $2,200 cash and sold existing equipment for $580 cash. The equipment that was sold had cost $1,540 and had Accumulated Depreciation of $330 at the time of sale. b. Borrowed $1,100 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 this expense was fully paid in cash. Required: 1. Prepare the statement of cash flows for the year ended December 31 using the indirect method. (Amounts to be deducted should be indicated with a minus sign.) HEADS UP COMPANY Statement of Cash Flows For the Year Ended December 31 Cash Flows from Operating Activities: Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities: Changes in Current Assets and Current Liabilities Cash Flows from Investing Activities: 0 0 Cash Flows from Financing Activities: 0 $ 0