Swasey Company provided the following partial comparative balance sheets and the income statement for 20X2.

Question not attempted.

Swasey Company

Comparative Balance Sheets

At December 31, 20X1 and 20X2

1		20X1	20X2
2	Current assets:
3	Cash	$234,500.00	$672,000.00
4	Accounts receivable	$747,000.00	$585,000.00
5	Inventories	296,000.00	318,000.00
6	Long-term assets:
7	Plant and equipment	2,202,000.00	2,140,000.00
8	Accumulated depreciation	(1,202,000.00)	(1,270,000.00)
9	Land	991,000.00	1,437,500.00
10	Total assets	$3,268,500.00	$3,882,500.00
11	Current liabilities:
12	Wages payable	$699,000.00	$514,000.00
13	Long-term liabilities:
14	Bonds payable	0.00	384,500.00
15	Mortgage payable	96,500.00	0.00
16	Total liabilities	$795,500.00	$898,500.00
17	Stockholders equity:
18	Common stock	380,000.00	380,000.00
19	Paid-in capital in excess of par	276,000.00	276,000.00
20	Retained earnings	1,817,000.00	2,328,000.00
21	Total stockholders equity	2,473,000.00	2,984,000.00
22	Total liabilities and stockholders equity	$3,268,500.00	$3,882,500.00

Question not attempted.

Swasey Company

Income Statement

For the Year Ended December 31, 20X2

1	Revenues	$3,010,000.00
2	Gain on sale of equipment	104,000.00
3	Cost of goods sold	(1,918,000.00)
4	Depreciation expense	(276,000.00)
5	Interest expense	(12,500.00)
6	Net income	$907,500.00

During the year, Swasey Company sold equipment with a book value of $279,000 for $383,000 (original purchase cost of $487,000). New equipment was purchased.

	Required:
1.	Prepare a statement of cash flows for Swasey for 20X2.
2.	Reflect on the relationship between the statement of cash flows and the change in cash.