Kay Wing, Inc., prepared the following balance sheet at December 31, 20X0. Kay Wing, Inc. Balance Sheet as of December 31, 20x0 Cash Accounts receivable Inventory Long-term investments Land Plant and equipment (net) Total assets Accounts payable Taxes payable Bonds payable Capital stock Retained earnings Total liabilities and stockholders' equity $ 65,000 37,000 70,000 20,000 39,000 109,000 $340,000 $ 33,000 4,000 80,000 90,000 133,000 $340,000 The following occurred during 20X1. 1. A $35,000 note payable was issued. 2. Land was purchased for $50,000. 3. Bonds payable (maturing in 20X5) in the amount of $30,000 were retired by paying $30,000 cash. 4. Capital stock in the amount of $40,000 was issued at par value. 5. The company sold surplus equipment for $14,000. The equipment had a book value of $14,000 at the time of the sale. 6. Net income was $35,500. 7. Cash dividends of $5,000 were paid to the stockholders. 8. 100 shares of stock of another company (considered short-term investments) were purchased for $8,300. 9. $75,000 in bonds were issued. The next day, the proceeds were used to purchase a new building. 10. $12,000 of depreciation was recorded on the plant and equipment. 11. At December 31, 20X1, Cash was $93,200, Accounts receivable had a balance of $41,500, Inventory had increased to $73,000, and Accounts payable had fallen to $25,500. Long-term investments and Taxes payable were unchanged from 20X0. Required: 1. Prepare a statement of cash flows for 20X1. 2. Prepare the December 31, 20X1, balance sheet for Kay Wing, Inc. Answer is not complete. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare a statement of cash flows for 20X1. (Net cash outflows and amounts to be deducted should be indicated by a minus sign.) VW: ne Kay Wing, Inc. Statement of Cash Flows For the Year Ended December 31, 20X1 Cash flows from operating activities: Net income $ 35,500 Adjustments to reconcile net income to net cash provided by operating activities Depreciation expense 12,000 Increase in accounts receivable (4,500) (3,000) (7,500) $ (3,000) 32,500 Increase in inventory Decrease in accounts payable Cash flow provided by operating activities Cash flows from investing activities: Purchase of land Sale of equipment Purchase of short-term investments (50,000) 14,000 (8,300) (44,300) Net cash used in investing activities Cash flows from financing activities: Issuance of capital stock Issuance of bonds Payment of cash dividends Issuance of note payable >IX OOOO 40,000 (30,000) (5,000) 35,000 40,000 28,200 Net cash provided by financing activities Net increase in cash Cash at beginning of year Cash at end of 65,000 93,200 year $ Required 1 Required 2 Prepare the December 31, 20x1, balance sheet for Kay Wing, Inc. Kay Wing, Inc. Balance Sheet December 31, 20X1 Cash $ 93,200 Accounts receivable Inventory Short-term investments 41,500 73,000 8,300 Long-term investments 20,000 89,000 Land Plant and equipment (net) 158,000 Total assets $ 483,000 $ 25,500 4,000 125,000 Accounts payable Taxes payable Bonds payable Notes payable Capital stock Retained earnings 35,000 130,000 163,500 Total liabilities and stockholders' equity $ 483,000 Required 1 Required 2