The management team of Wickersham Brothers Inc. is preparing its annual financial statements. The statements are complete except for the statement of cash flows. The completed comparative balance sheets and income statements are summarized. Current Year Prior Year Balance Sheet Assets Cash Accounts receivable Merchandise inventory Property and equipment. Less: Accumulated depreciation Total assets Liabilities: Accounts payable Salaries and Wages Payable Notes payable, long-term Stockholders' Equity: Common stock Retained earnings Total liabilities and stockholders' equity Income Statement Sales Cost of goods sold Depreciation expense Other expenses Net income $112,500 $130,500 140,000 122,500 105,000 113,750 200,000 105,000 (58,000) (30,000) $499,500 $441,750 $ 17,500 3,500 87,500 $ 21,000 1,750 105,000 160,000 140,000 231,000 174,000 $499,500 $441,750 $500,000 260,000 28,000 125,000 $ 87,000 Other information from the company's records includes the following: Bought equipment for cash, $95,000. Paid $17,500 on long-term note payable. Issued new shares of common stock for $20,000 cash. Cash dividends of $30,000 were declared and paid to stockholders. Accounts Payable arose from inventory purchases on credit. Income tax expense ($21,750) and interest expense ($5,250) were paid in full at the end of both years and are included in Other Expenses.