The Extra Surplus Company's Balance Sheet for December 31, 2015 and the Income Statement for 2016 are shown below.

Extra Surplus Company
Balance Sheet
December 31, 2015
Assets
Cash	$	12,000
Accounts Receivable		6,000
Inventory		14,400
Property and Equipment, Net		24,000
	$	56,400
Liabilities and Stockholders Equity
Accounts Payable	$	12,000
Notes Payable, Long-Term		6,000
Common Stock		24,000
Retained Earnings		14,400
	$	56,400

Extra Surplus Company
Income Statement
For the Year Ended December 31, 2016
Sales	$	18,200
Cost of Goods Sold		4,200
Salaries and Wage Expense		4,200
Interest Expense		1,400
Other Expenses		700
Net Income	$	7,700

Additional data:

Sales were $18,200; $11,200 in cash was received from customers.

Bought new land for cash, $14,000.

Sold other land for its book value of $7,000.

Paid $1,400 principal on the long-term note payable and $1,400 in interest.

Issued new shares of stock for $14,000 cash.

Cash dividends of $1,800 were declared and paid to stockholders.

Paid $7,900 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, 2016.

b.	Prepare the statement of cash flows using the direct method. (Enter any deductions and cash outflows as a negative value.)