The extra surplus company balance sheet for December 31, 2017 and the income statement are shown below.

Extra Surplus Company Balance Sheet December 31,2017 Assets Cash Inventory Property and Equipment, Net \begin{tabular}{lr} \multicolumn{1}{l}{ Liabilities and Stockholders' Equity } & \\ Accounts Payable & $18,500 \\ Notes Payable, Long-Term & 9,250 \\ Common Stock & 37,000 \\ Retained Earnings & 22,200 \\ & $86,950 \\ \hline \end{tabular} Extra Surplus Company Income Statement \begin{tabular}{lr} Fales the Year Ended December 31,2018 \\ Cost of Goods Sold & $35,100 \\ Salaries and Wage Expense & 8,100 \\ Interest Expense & 8,100 \\ Other Expenses & 2,700 \\ Net Income & 1,350 \\ \hline \end{tabular} Additional data: - Sales were $35,100;$21,600 in cash was received from customers. - Bought new land for cash, $27,000. - Sold other land for its book value of $13,500. - Paid $2,700 principal on the long-term note payable and $2,700 in interest. - Issued new shares of stock for $27,000 cash. - Cash dividends of $4,400 were declared and paid to stockholders. - Paid $15,700 on accounts payable. - No inventory purchases were made; other expenses were incurred on account. - All wages were paid in cash. - Other expenses were on account. Required: a. Prepare a balance sheet at December 31,2018. b. Prepare the statement of cash flows using the direct method