Ravenna Company is a merchandiser that uses the indirect method to prepare the operating activities section of its statement of cash flows. Its balance sheet for this year is as follows: Ending Balance Beginning Balance Cash $ 97,200 $ 116,700 Accounts receivable 77,600 83,600 Inventory 104,200 95,000 Total current assets 279,000 295,300 Property, plant, and equipment 276,000 266,000 Less accumulated depreciation 92,000 66,500 Net property, plant, and equipment 184,000 199,500 Total assets $ 463,000 $ 494,800 Accounts payable $ 60,800 $ 108,000 Income taxes payable 47,200 62,800 Bonds payable 114,000 95,000 Common stock 133,000 114,000 Retained earnings 108,000 115,000 Total liabilities and stockholders equity $ 463,000 $ 494,800 During the year, Ravenna paid a $11,400 cash dividend and it sold a piece of equipment for $5,700 that had originally cost $13,200 and had accumulated depreciation of $8,800. The company did not retire any bonds or repurchase any of its own common stock during the year.

Required: 1. What is the amount of the net increase or decrease in cash and cash equivalents that would be shown on the companys statement of cash flows?

2. What net income would the company include on its statement of cash flows?

3. How much depreciation would the company add to net income on its statement of cash flows?

4-a. If the company debited Accounts Receivable and credited Sales for $1,140,000 during the year, what is the total amount of credits recorded in Accounts Receivable during the year?

4-b. What does the amount of these credits represent?