The income statement, balance sheets, and additional information for Virtual Gaming Systems are provided.

VIRTUAL GAMING SYSTEMS Income Statement For the Year Ended December 31, 2018

Net sales $ 2,560,000 Gain on sale of land 5,000 Total revenues 2,565,000

Expenses: Cost of goods sold $ 1,630,000 Operating expenses 611,000 Depreciation expense 29,000 Interest expense 30,000 Income tax expense 76,000 Total expenses 2,376,000 Net income $ 189,000

VIRTUAL GAMING SYSTEMS Balance Sheets December 31
	2018		2017
Assets
Current assets:
Cash	$	331,240	$	269,880
Accounts receivable		68,400		84,000
Inventory		154,000		141,000
Prepaid rent		4,360		6,720
Long-term assets:
Investments		191,000		100,000
Land		213,000		266,000
Equipment		242,000		216,000
Accumulated depreciation		(137,000)		(108,000)
Total assets	$	1,067,000	$	975,600
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable	$	33,000	$	94,000
Interest payable		4,600		3,600
Income tax payable		23,400		27,000
Long-term liabilities:
Notes payable		257,000		231,000
Stockholders' equity:
Common stock		416,000		360,000
Retained earnings		333,000		260,000
Total liabilities and stockholders equity	$	1,067,000	$	975,600

Additional Information for 2018:

1. Purchase additional investment in stocks for $91,000.

2. Sell land costing $53,000 for $58,000, resulting in a $5,000 gain on sale of land.

3. Purchase $26,000 in equipment by borrowing $26,000 with a note payable due in three years. No cash is exchanged in the transaction.

4. Declare and pay a cash dividend of $116,000.

5. Issue common stock for $56,000.

Required:

Prepare the statement of cash flows using the indirect method. Disclose any noncash transactions in an accompanying note