Required information [The following information applies to the questions displayed below.] Golden Corporation's current year income statement, comparative balance sheets, and additional information follow. For the year, (1) all sales are credit sales, (2) all credits to Accounts Receivable reflect cash receipts from customers, (3) all purchases of inventory are on credit, (4) all debits to Accounts Payable reflect cash payments for inventory, and (5) any change in Income Taxes Payable reflects the accrual and cash payment of taxes. Assets Cash Accounts receivable Inventory Total current assets Equipment Accumulated depreciation-Equipment Total assets Liabilities and Equity Accounts payable Income taxes payable GOLDEN CORPORATION Comparative Balance Sheets December 31 Current Year Prior Year $ 175,000 $ 119,100 99,500 82,000 617,500 537,000 892,000 738,100 364,600 310,000 (163,500) (109,500) $ 1,093,100 $ 109,000 39,000 $ 938,600 $ 82,000 30,600 Total current liabilities Equity Common stock, $2 par value Paid-in capital in excess of par value, common stock Retained earnings Total liabilities and equity Sales GOLDEN CORPORATION Income Statement For Current Year Ended December 31 Cost of goods sold Gross profit Operating expenses (excluding depreciation) Depreciation expense Income before taxes Income taxes expense Net income $ 1,847,000 1,097,000 750,000 505,000 54,000 191,000 37,400 $ 153,600 148,000 112,600 605,200 579,000 215,800 176,500 124,100 70,500 $ 1,093,100 $ 938,600 Additional Information on Current Year Transactions a. Purchased equipment for $54,600 cash. b. Issued 13,100 shares of common stock for $5 cash per share. c. Declared and paid $100,000 in cash dividends. Required: Prepare a complete statement of cash flows using the direct method for the current year. Note: Amounts to be deducted should be indicated with a minus sign. Answer is complete but not entirely correct. GOLDEN CORPORATION Statement of Cash Flows For Current Year Ended December 31 Cash flows from operating activities Net income Increase in accounts receivable Increase in inventory Increase in accounts payable Increase in income taxes payable Net cash provided by operating activities + $ 153,600 x (17,500) (80,500) 27,000 8,400 $ 91,000 Cash flows from investing activities Cash paid for equipment (54,600) Net cash used in investing activities (54,600) Cash flows from financing activities Cash paid for dividends (100,000) Cash received from issuing stock 65,500 Net cash used in financing activities (34,500) 1,900 Net increase (decrease) in cash Cash balance at December 31, prior year Cash balance at December 31, current year $ 119,100 $ 121,000