The income statement, balance sheets, and additional information for Video Phones, Inc., are provided. Net sales. Expenses: VIDEO PHONES, INC. Income Statement For the Year Ended December 31, 2021 Cost of goods sold Operating expenses Depreciation expense Loss on sale of land Interest expense Income tax expense Total expenses Net income i $1,600,000 788,000 20,000 7,300 11,500 41,000 $2,636,000 2,467,800 $ 168,200 Assets Current assets: Cash Accounts receivable. Inventory Prepaid rent Long-term assets: Investments Land VIDEO PHONES, INC. Balance Sheets December 31 2021 2020 $159,180 73,300 $ 85,940 105,000 9,120 53,000 128,000 4,560 98,000 0 203,000 226,000 256,000 203,000 (60,600) (40,600) $843,000 $659,900 Equipment Accumulated depreciation Total assets Liabilities and Stockholders' Equity Current liabilities: Accounts payable $ 59,700 $ 74.000 3 Current liabilities: Accounts payable Interest payable Income tax payable Long-term liabilities: Notes payable Stockholders' equity: Common stock Retained earnings $ 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 Total liabilities and stockholders' equity Additional Information for 2021: 1. Purchase investment in bonds for $98,000. 2. Sell land costing $23,000 for only $15,700, resulting in a $7,300 loss on sale of land. 3. Purchase $53,000 in equipment by issuing a $53,000 long-term note payable to the seller. No cash is exchanged in the transaction. 4. Declare and pay a cash dividend of $21,500. Required: Prepare the statement of cash flows for Video Phones, Inc., using the direct method. Disclose any noncash transactions in an accompanying note. (List cash outflows and any decrease in cash as negative amounts.) VIDEO PHONES, INC. Statement of Cash Flows For the Year Ended December 31, 2021 Cash Flows from Operating Activities: Cash received from customers Cash paid to suppliers Cash paid for income taxes Cash paid for interest $ 2,615,700 1,591,300 40,000 14,800 For the Year Ended December 31, 2021 Cash Flows from Operating Activities: Cash received from customers Cash paid to suppliers Cash paid for income taxes Cash paid for interest Cash paid for operating expenses Increase in prepaid rent Decrease in accounts payable Net cash flows from operating activities Cash Flows from Investing Activities: Net cash flows from investing activities Cash Flows from Financing Activities: Net cash flows from financing activities Cash at the beginning of the period Cash at the end of the period $ 2,615,700 1,591,300 40,000 14,800 792,560 $ 5,054,360 0 0 Cash paid for interest Cash paid for operating expenses Increase in prepaid rent Decrease in accounts payable Net cash flows from operating activities Cash Flows from Investing Activities: Net cash flows from investing activities Cash Flows from Financing Activities: Net cash flows from financing activities Cash at the beginning of the period Cash at the end of the period Note: Noncash Activities 13555 14,800 792,560 Saved $ 5,054,360 0 0 $ 0