Statement of Cash Flows-Direct Method The comparative balance sheet of Canace Products Inc. for December 31, 20Y6 and 20Y5, is as follows: Cash Accounts receivable (net) Inventories Investments Land Equipment Assets Accumulated depreciation-equipment Total assets Liabilities and Stockholders' Equity Dec. 31, 20Y6 Dec. 31, 20Y5 $307,290 $288,810 111,320 103,730 314,250 307,120 0 118,980 161,180 0 346,710 271,530 (81,170) (73,220) $1,159,580 $1,016,950 Accounts payable $209,880 $200,340 Accrued expenses payable 20,870 26,440 Dividends payable 11,600 9,150 Common stock, $10 par 62,620 49,830 Paid-in capital: Excess of issue price over par-common stock 235,390 138,310 Retained earnings 619,220 592,880 Paid-in capital: Excess of issue price over par-common stock Retained earnings Total liabilities and stockholders' equity 235,390 138,310 619,220 592,880 $1,159,580 $1,016,950 The income statement for the year ended December 31, 20Y6, is as follows: Sales Cost of merchandise sold Gross profit Operating expenses: $1,633,030 672,400 $960,630 Depreciation expense $7,950 Other operating expenses 848,150 Total operating expenses 856,100 Operating income $104,530 Other expense: Loss on sale of investments Income before income tax Income tax expense Net income (32,120) $72,410 23,170 $49,240 Additional data obtained from an examination of the accounts in the ledger for 20Y6 are as follows: a. Equipment and land were acquired for cash. b. There were no disposals of equipment during the year. c. The investments were sold for $86,860 cash. d The common stock was issued for cash c. The investments were sold for $86,860 cash. d. The common stock was issued for cash. e. There was a $22,900 debit to Retained Earnings for cash dividends declared. Required: Prepare a statement of cash flows, using the direct method of presenting cash flows from operating activities. Use the minus sign to indicate cash outflows, cash payments, decreases in cash, or any negative adjustments. Canace Products Inc. Statement of Cash Flows For the Year Ended December 31, 20Y6 Cash flows from operating activities: Cash received from customers 1,625,440 Cash payments for merchandise Cash payments for operating expenses Cash payments for income taxes Net cash flow from operating activities Cash flows from (used for) investing activities: Cash received from gain on sale of investments Cash used for purchase of land Cash used for purchase of equipment Net cash flow used for investing activities Cash flows from (used for) financing activities: Cash from sale of common stock Cash used for dividends Statement of Cash Flows For the Year Ended December 31, 20Y6 Cash flows from operating activities: Cash received from customers Cash payments for merchandise Cash payments for operating expenses Cash payments for income taxes Net cash flow from operating activities Cash flows from (used for) investing activities: Cash received from gain on sale of investments Cash used for purchase of land Cash used for purchase of equipment Net cash flow used for investing activities Cash flows from (used for) financing activities: Cash from sale of common stock Cash used for dividends Net cash flow from financing activities Decrease in cash Cash at the beginning of the year Cash at the end of the year 1,625,440