The comparative balance sheets and income statements for Stuart Company follow: Balance Sheets As of December 31 Year 2 Year 1 Assets Cash Accounts receivable Inventory Equipment Accumulated depreciation-equipment Land Total assets Liabilities and equity Accounts payable (inventory) Long-term debt Common stock Retained earnings Total liabilities and equity $ 23,912 1,812 6,297 19,341 (10,993) 19,090 $ 59,459 $ 2,852 1,087 5,903 41,571 (18,846) 11,060 $ 43,627 $ 2,508 2,682 21,600 32,669 $ 59,459 $ 4,051 6,130 10,000 23,446 $ 43,627 Income Statement For the Year Ended December 31, Year 2 Sales revenue $ 34,720 Cost of goods sold (13,762) Gross margin 20,958 Depreciation expense (3,092) Operating income 17,866 Gain on sale of equipment 650 Loss on disposal of land (70) Net income $ 18,446 Additional Data 1. During Year 2, the company sold equipment for $18,705; it had originally cost $29,000. Accumulated depreciation on this equipment was $10,945 at the time of the sale. Also, the company purchased equipment for $6,770 cash. 2. The company sold land that had cost $3,570. This land was sold for $3,500, resulting in the recognition of a $70 loss. Also, common stock was issued in exchange for title to land that was valued at $11,600 at the time of exchange. 3. Paid dividends of $9,223. Statement of Cash Flows For the Year Ended December 31, Year 2 Cash flows from operating activities: Less: Increase/Decrease in current assets and current liabilities Plus: Noncash charges Cash flows from investing activities: Cash flows from financing activities