PA12-3 Preparing a Statement of Cash Flows (Indirect Method) [LO 12-2, LO 12-3, LO 12-4, LO 12-5] XS Supply Company is developing its annual financial statements at December 31. The statements are complete except for the statement of cash flows. The completed comparative balance sheets and income statement are summarized Previous Current Year Year Balance Sheet at December 31 Cash Accounts Receivable Inventory Equipment Accumulated Depreciation Equipment $ 35,370 30,450 28,800 38,800 108,000 36,600 42,600 133,000 (31,600) (25,800) $215,970 $180,250 Accounts Payable Salaries and Wages Payable Note Payable (long-term) Common Stock Retained Earnings S 37,600 970 45,200 93,400 38,800 27,800 1,250 52,000 73,400 25,800 $215,970 $180,250 Income Statement Sales Revenue Cost of Goods Sold Other Expenses $128,000 74,000 41,000 Net Income $13,000 Additional Data: a. Bought equipment for cash, $25,000 b. Paid $6,800 on the long-term note payable. C. Issued new shares of stock for S20.000 cash. d. No dividends were declared or paid e. Other expenses included depreciation, $5,800; Salaries and wages, $20,800; taxes, $6,800; utilities, $7,600 f. Accounts Payable includes only inventory purchases made on credit. Because there are no liability accounts relating to taxes or other expenses, assume that these expenses were fully paid in cash. Required: 1. Prepare the statement of cash flows for the current year ended December 31 using the indirect method. (Amounts to be deducted should be indicated with a minus sign.) XS SUPPLY 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 Cash Flows from Investing Activities: Cash Flows from Financing Activities