Sharp Screen Films, Inc., is developing its annual financial statements at December 31, current year. The statements are complete except for the statement of cash flows. The completed comparative balance sheets and income statement are summarized as follows: Current Year Prior Year Balance sheet at December 31 Cash Accounts receivable Merchandise inventory Property and equipment Less: Accumulated depreciation $ 65,950 16,050 23,250 209,950 (60,100) $255, 100 $ 9,900 3,000 61,300 99,800 81,100 $255, 100 $ 64,400 23,250 18,400 151,900 (46,150) $211,800 $ 20,000 3,200 72,100 66,300 50,200 $211,800 Accounts payable Wages payable Note payable, long-term Common stock and additional paid-in capital Retained earnings Income statement for current year Sales Cost of goods sold Depreciation expense Other expenses Net income $199,000 96,000 13,950 43,400 $ 45,650 Additional Data: a. Bought equipment for cash, $58,050. b. Paid $10,800 on the long-term note payable. c. Issued new shares of stock for $33,500 cash. d. Dividends of $14,750 were declared and paid. e. Other expenses all relate to wages. f. Accounts payable includes only inventory purchases made on credit. Required: 1. Prepare the statement of cash flows using the indirect method for the year ended December 31, current year. (List cash outflows as negative amounts.) SHARP SCREEN FILMS, INC. Statement of Cash Flows For the Year Ended December 31, Current Year Cash flows from operating activities: Net income Adjustments to reconcile net income to net cash provided by operating activities: Depreciation expense Decrease in accounts receivable Increase in merchandise inventory Decrease in accounts payable Decrease in wages payable 0 0 Cash flows from investing activities: Cash payments to purchase property and equipment 0 Cash flows from financing activities: Cash payments on long-term note Cash receipts from issuing stock Cash payments for dividends 0