Method The comparative balance sheet of Canace Products Inc. for December 31, 20Y6 and 20Y5, is as follows: Dec. 31, 20Y6 Dec. 31, 20YS $302,320 109,520 309,170 $280,260 100,660 298,020 115,460 Accounts receivable (net) Inventories Investments Land Equipment Accumulated depreciation 158,580 341,110 263,480 75.860) (71.050) (71,050) $986,830 Total assets $1,140,840 Accounts payable (merchandise creditors) Accrued expenses payable (operating expenses) Dividends payable Common stock, $10 par Paid-in capital: Excess of issue price over par-common stock Retained earnings $206,490 20,540 11,410 61,610 231,590 609,200 $1,140,840 $194,410 25,660 8,880 48,350 134,210 575,320 $986,830 Total liabilities and stockholders' equity The income statement for the year ended December 31, 20Y6, is as follows Cost of goods sold Gross profit Operating expenses: $1,775,340 731,000 $1,044,340 Depreciation expense $8,810 Other operating expenses 921,890 Total operating expenses 930,700 Operating income Other expense: $113,640 Loss on sale of investments (31.170) Income before income tax income tax expense Net income 56,080 Additional data obtained from an examination of the accounts in the ledger for 20Y6 are as follows: a. Equipment and land were acquired for cash b. There were no disposals of equipment during the year. c. The investments were sold for $84,290 cash. d. The common stock was issued for cash e. There was a $22,200 debit to Retained Earnings for cash dividends declared. Canace Products Inc. Statement of Cash Flows For the Year Ended December 31, 20YE Cash flows from operating activities: Cash received from austomers Cash payments for merchandise Cash payments for operating expenses v Cash payments for income taxes 1.766480 Net cash flow from operating activities Cash flows from investing activities: Cash received from sale of investments Cash paid for purchase of land Cash paid for purchase of equipment Net cash flow used for investing activities Cash flows from financing activities Cash received from sale of common stock v Cash paid for dividends v Net cash flow from financing activiters Change in cash v Cash at the beginning of the year Cash at the end of the year