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 $1,700,000 $2,756,000 808,000 22,000 7,500 12,500 43,000 2,593,000 $ 163,000 Assets Current assets: VIDEO PHONES, INCORPORATED Balance Sheets December 31 2024 2023 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 $ 172,900 $102,700 75,500 55,000 105,000 130,000 9,600 4,800 100,000 0 205,000 230,000 260,000 205,000 (63,000) (41,000) $865,000 $686,500 $ 61,500 $ 76,000 5,500 9,000 14,500 13,500 275,000 220,000 Stockholders' equity: Common stock 250,000 250,000 Retained earnings 258,500 118,000 Total liabilities and stockholders' equity $865,000 $686,500 Additional Information for 2024: 1. Purchased investment in bonds for $100,000. 2. Sold land for $17,500. The land originally was purchased for $25,000, resulting in a $7,500 loss being recorded at the time of the sale. 3. Purchased $55,000 in equipment by issuing a $55,000 long-term note payable to the seller. No cash was exchanged in the transaction. 4. Declared and paid a cash dividend of $22,500. Required: Prepare the statement of cash flows for Video Phones, Incorporated, using the direct 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.) VIDEO PHONES, INCORPORATED Statement of Cash Flows For the Year Ended December 31, 2024 Cash Flows from Operating Activities: Cash received from customers Cash paid to suppliers Cash paid for operating expenses Cash paid for interest Cash paid for income taxes Net cash flows from operating activities Cash Flows from Investing Activities: Purchase investment in bonds Proceeds from sale of land Net cash flows from investing activities Cash Flows from Financing Activities: Payment of cash dividends Net cash flows from financing activities 0 0 $ 0 (100,000) 17,500 0 0 (82,500) (22,500) 0 0 (22,500) Net increase in cash Cash at the beginning of the period Cash at the end of the period 102,700 $ 102,700 Note: Noncash Activities Purchase equipment by issuing a note payable $ 55,000