Statement of Cash FlowsDirect Method

The comparative balance sheet of Canace Products Inc. for December 31, 20Y6 and 20Y5, is as follows:

		Dec. 31, 20Y6		Dec. 31, 20Y5
Assets
Cash		$227,750		$214,540
Accounts receivable (net)		82,510		77,050
Inventories		232,900		228,150
Investments		0		88,390
Land		119,460		0
Equipment		256,970		201,700
Accumulated depreciation-equipment		(60,160)		(54,390)
	Total assets	$859,430		$755,440
Liabilities and Stockholders' Equity
Accounts payable		$155,560		$148,820
Accrued expenses payable		15,470		19,640
Dividends payable		8,590		6,800
Common stock, $10 par		46,410		37,020
Paid-in capital: Excess of issue price over par-common stock		174,460		102,740
Retained earnings		458,940		440,420
	Total liabilities and stockholders equity	$859,430		$755,440

The income statement for the year ended December 31, 20Y6, is as follows:

Sales					$1,189,010
Cost of merchandise sold					489,600
Gross profit					$699,410
Operating expenses:
	Depreciation expense		$5,770
	Other operating expenses		617,530
		Total operating expenses			623,300
Operating income					$76,110
Other expense:
		Loss on sale of investments			(23,870)
Income before income tax					$52,240
Income tax expense					16,720
Net income					$35,520

Additional data obtained from an examination of the accounts in the ledger for 20Y6 are as follows:

1. Equipment and land were acquired for cash.
2. There were no disposals of equipment during the year.
3. The investments were sold for $64,520 cash.
4. The common stock was issued for cash.
5. There was a $17,000 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.

Statement of Cash Flows For the Year Ended December 31, 2046 Cash flows from operating activities: Cash received from customers 1,183,550 Cash payments for merchandise 487,610 x Cash payments for operating expenses Cash payments for income taxes 16,720 X Net cash flow from operating activities Cash flows from (used for) investing activities: Cash from sale of investments 64,520 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 Increase in cash 13,210 Cash at the beginning of the year 214,540 Cash at the end of the year 227,750