These are the financial statements of Metro Meats Ltd.

METRO MEATS LTD Statement of financial position as at 31 December 2018
	2018	2017
ASSETS
Cash	$129 000)	$115 000)
Accounts receivable	28 000)	14 000)
Inventory	25 000)	35 000)
Property, plant and equipment	60 000)	78 000)
Accumulated depreciation	(20 000)	(24 000)
Total assets	$122 000)	$118 000)
LIABILITIES AND EQUITY
Accounts payable	$126 000)	$125 000)
Dividends payable	3 000)
Income tax payable	5 000)	8 000)
Debentures payable	27 000)	33 000)
Share capital	18 000)	14 000)
Retained earnings	43 000)	38 000)
Total liabilities and equity	$122 000)	$118 000)

METRO MEATS LTD Statement of profit or loss for the year ended 31 December 2018
Sales	$250 000)
Cost of sales	210 000)
Gross profit	40 000)
Selling expenses	18 000)
Administrative expenses	6 000)
Interest expense	2 000)
Profit before income tax	14 000)
Income tax expense	4 000)
Profit	$10 000)

The following additional data were provided:

1. The entity paid an interim dividend of $2000 and declared a final dividend.
2. During the year equipment was sold for $8500 cash. This equipment cost $18 000 originally and had a carrying amount of $8500 at the time of sale.
3. All depreciation expense is in the selling expense category.
4. All operating expenses except for depreciation were paid in cash.

Required

1. Prepare a statement of cash flows using the direct method.
2. Reconcile profit to cash provided by operating activities.