The income statement, balance sheets, and additional information for Video Phones, Incorporated, are provided. Net sales Expenses: VIDEO PHONES, INCORPORATED Income Statement For the Year Ended December 31, 2024 Cost of goods sold Operating expenses Depreciation expense Loss on sale of land Interest expense Income tax expense Total expenses Net income $1,600,000 $2,636,000 788,000 20,000 7,300 11,500 41,000 2,467,800 $ 168,200 VIDEO PHONES, INCORPORATED Balance Sheets December 31 2024 2023 Assets Current assets: Cash Accounts receivable Inventory Prepaid rent Long-term assets: Investments Land Equipment Accumulated depreciation Total assets Liabilities and Stockholders' Equity Current liabilities: Accounts payable Interest payable Tncome tax navahle $159,180 73,300 105,000 $85,940 53,000 128,000 9,120 4,560 98,000 203,000 226,000 256,000 203,000. (60,600) (40,600) $843,000 $659,900 $ 59,700 5,300 14.300 $ 74,000 8,600 13.300 Assets Current assets: Cash Accounts receivable Inventory Prepaid rent Long-term assets: Investments. Land Equipment Accumulated depreciation Total assets Liabilities and Stockholders' Equity Current liabilities: Accounts payable Interest payable Income tax payable Long-term liabilities: Notes payable Stockholders' equity Common stock Retained earnings Total liabilities and stockholders' equity Additional Information for 2024: $159,180 $85,940 73,300 53,000 105,000 128,000 9,120 4,560 98,000 0 203,000 226,000 256,000 203,000 (60,600) (40,600) $843,000 $659,900 59,700 5,300 14,300 $ 74,000 8,600 13,300 271,000 218,000 230,000 230,000 262,700 116,000 $843,000 $659,900 1. Purchased investment in bonds for $98,000. 2. Sold land for $15,700. The land originally was purchased for $23,000, resulting in a $7,300 loss being recorded at the time of the sale. 3. Purchased $53,000 in equipment by issuing a $53,000 long-term note payable to the seller. No cash was exchanged in the transaction. 4. Declared and paid a cash dividend of $21,500. Required: Prepare the statement of cash flows using the indirect method. Disclose any noncash transactions in an accompanying note. (Amounts to be deducted, cash outflows, and any decrease in cash should be indicated with a minus sign.) Required: Prepare the statement of cash flows using the indirect method. Disclose any noncash transactions in an accompanying note. (Amounts to be deducted, cash outflows, and any decrease in cash should be indicated with a minus sign.) Answer is complete but not entirely correct. VIDEO PHONES, INCORPORATED Statement of Cash Flows Cash Flows from Operating Activities: Net income Adjustments to reconcile net income to net cash flows from operating activities: Depreciation expense Loss (on sale of land) Increase in accounts receivable Decrease in inventory Increase in prepaid rent Decrease in accounts payable Decrease in interest payable Increase in income tax payable For the Year Ended December 31, 2024 $142,200 30,000 8,300 (21,300) 33,000x (6,360) (15,300) (4,300) 1,000- Net cash flows from operating activities Cash Flows from Investing Activities: Purchase investment in bonds Proceeds from sale of land (108,000) 24,700 $ 167,240 Decrease in interest payable Increase in income tax payable Net cash flows from operating activities Cash Flows from Investing Activities: Purchase investment in bonds Proceeds from sale of land (4,300) 1,000 (108,000) 24,700 Net cash flows from investing activities Cash Flows from Financing Activities: Payment of cash dividends $ (26,500) Net cash flows from financing activities Net increase in cash Cash at the beginning of the period Cash at the end of the period Note: Noncash Activities Purchase equipment by issuing a note payable $ 167,240 (83,300) (26,500) 57,440 169,140 $ 226,580 $ 63,000