S Soft Touch Company was started several years ago by two golf instructors. The company's comparative balance sheets and income statement are presented below, along with additional information. Balance Sheet at December 31 Cash Accounts Receivable Equipment Accumulated Depreciation-Equipment Total Assets Accounts Payable Salaries and Wages Payable Notes Payable (long-term) Common Stock Retained Earnings Current Year Previous Year $ 13,560 $ 7,750 2,300 12,900 (2,570) $ 26,190 $ 1,400 960 2,900 12,000 3,400 12,000 (2,400) $ 20,750 $ 1,900 1,450 1,000 12,000 8,930 4,400 Total Liabilities and Stockholders' Equity $ 26,190 $ 20,750 Income Statement Service Revenue Salaries and Wages Expense Depreciation Expense Loss on Disposal of Equipment Income Tax Expense Net Income Additional Data: $ 74,400 67,500 780 390 1,200 $ 4,530 a. Bought new golf clubs for $2,900 cash and sold existing clubs for $1,000 cash. The clubs that were sold had cost $2,000 and had Accumulated Depreciation of $610 at the time of sale. b. Borrowed $1,900 cash from the bank during the year. c. Accounts Payable includes only purchases of services made on credit for operating purposes. Because there are no liability accounts relating to income tax, assume that Income Tax Expense was fully paid in cash. Required: 1. Prepare the statement of cash flows for the year ended December 31 using the indirect method. (Amounts to be deducted should be indicated with a minus sign.) Check my