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 Note Payable long-term Common Stock Retained Earnings Total Libilities and tockholders Equity Income statement SVL Revenge salaries and Wages Expense Depreciation Expanse Lors on Disposal of Hument Income Tax pense Not Income $ 6060 970 6,340 (1.570) 511,800 5 530 430 1.500 3.700 3.60 511,000 3.4.300 1,899 5.700 (1,320) 910.650 $1,100 750 500 5,700 2.600 910,650 $3,900 36,400 590 620 270 $1.000 Additional Data: a. Bought new equipment for $2150 cash and sold exsting equipment for $570 cash. The equipment that was sold had cost $1,510 and had Accumulated Depreciation of $320 at the time of sale. b. Borrowed $1,000 cash from the bank during the year 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 $ 1,040 HEADS UP COMPANY Statement of Cash Flows For the Year Ended December 31 Cash Flows from Operating Activities: Net Income Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities: Depreciation Expense Decrease in Accounts Receivable Decrease in Accounts Payable Decrease in Salaries and Wages Payable 570 (920) 570 (320) 940 Net Cash Provided by Operating Activities Cash Flows from Investing Activities: Cash Payments to Purchase Equipment 2,150 2,150 Net Cash Used in Investing Activities 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 Cash Balance, December 31 $ 0