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. Current Year Previous Year 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 Total Liabilities and Stockholders' Equity Income Statement Service Revenue Salaries and Wages Expense Depreciation Expense Income Tax Expense Net Income $ 6,240 970 6,270 (1,640) $ 11,840 $ 530 430 1,500 5,700 3,680 $ 11,840 $ 4,380 1,890 5,700 (1,320 $ 10,650 $ 1,100 750 500 5,700 2,600 $ 10,650 $ 38,900 36, 400 320 1,100 $ 1,080 Additional Data: a. Bought new hockey equipment for cash, $570. b. Borrowed $1,000 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. HEADS UP COMPANY Statement of Cash Flows For the Year Ended December 31 Cash Flows from Operating Activities: $ 1,080 Net Income Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities: Depreciation Expense Changes in Current Assets and Current Liabilities Decrease in Salaries and Wages Payable 320 (320) 1,080 Net Cash Provided by Operating Activities Cash Flows from Investing Activities: Cash Payments to Purchase Equipment (570) Net Cash Used in Investing Activities (570) Cash Flows from Financing Activities: Cash Proceeds from Bank Loan 1,000 1,000 Net Cash Provided by Financing Activities Net Increase in Cash during the Year Cash Balance, January 1 1,860 4,380 6,240 $