PXE Company presented the following comparative balance sheets at December 31, 2005 and 2006, and the income statement for the year ended December 31, 2006:

PXE Company Balance Sheets December 31, 2006 and 2005
	December 31, 2006		December 31, 2005
Assets
Cash	$ 12,200		$ 28,200
Accounts receivable	16,000		18,000
Inventory	19,500		22,000
Prepaid rent	200		300
Total current assets	$ 47,900		$ 68,500
Land	58,000		30,000
Equipment	65,000		60,000
Accumulated depreciation	(11,000)		(4,000)
Total assets	$159,900		$154,500
Liabilities and stockholders equity
Accounts payable	$ 13,000		$ 25,000
Salaries payable	2,000		2,500
Interest payable	2,500		4,000
Income tax payable	6,500		3,000
Dividends payable	4,000		0
Total current liabilities	$ 28,000		$ 34,500
Long-term notes payable	10,000		40,000
Common stock, $1 par	30,000		28,000
Preferred stock, $4 par	24,000		10,000
Additional paid-in capital	45,000		30,000
Retained earnings	22,900		12,000
Total liabilities and stockholders equity	$159,900		$154,500

PXE Company Income Statement For the Year Ended December 31, 2006
Sales			$ 400,000
Cost of goods sold			(250,000)
Gross profit			$ 150,000
General and administrative expenses	$80,000
Salaries expense	31,000
Rent expense	3,600
Depreciation expense	7,000
Total operating expenses			(121,600)
Other revenue and expenses:
Gain on sale of land	$ 3,000
Interest revenue	300
Interest expense	(2,800)		500
Income before income taxes			$ 28,900
Income tax expense			(8,000)
Net income			$ 20,900

Additional information:

a. The company declared dividends in the amount of $10,000 during the year.

b. Additional land and equipment were purchased for cash.

c. Land that had originally cost $9,000 was sold for $12,000 cash.

d. All accounts payable are related to merchandise purchases.

e. The company uses a perpetual LIFO inventory system and uses straight-line depreciation for all depreciable assets.

Required:

1. Prepare the operating activities section of the statement of cash flows using the indirect method.

Net income 20,900

Add: noncash items:

Depreciation 7,000

Gain on sale of land (3,000)

Add: Increase in Current Liabilities

Income Tax payable 3,500

Dividends payable 4,000

Add: decrease in current assets

Inventory 2,500

Accounts receivable 2,000

Prepaid rent 100

Less: Decrease in current liabilities

Accounts payable 12,000

Salaries payable 500

Interest payable 1,500

Cash Flow from Operating Activities 23,000

Salary expense on the books was $43000. Salary payable at the beginning of the year was $11000 and at the end of the year was $12500. How much cash was paid out for salaries?

Rent expense on the books was $15000. Prepaid rent at the beginning of the year was $3000 and at the end of the year was $1250. How much cash was paid out for rent?

Sales revenue on the books was $118000. Accounts receivable at the end of the year was $14000 and accounts receivable at the beginning of the year was $16000. How much cash was received for sales?

Sales revenue on the books was $175000. Unearned revenue at the end of the year was $12000 and unearned revenue at the beginning of the year was $4500. How much cash was received from revenue?