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1 50 points eBook Print References SOFTWARE ASSOCIATES Income Statement For the year ended December 31, 2021 $366,000 116,000 31,600 42,000 Net sales Expenses: Cost of goods sold Operating expenses Depreciation expense Income tax expense Total expenses Net income. SOFTWARE ASSOCIATES Selected Balance Sheet Data December 31, 2021, compared to December 31, 2020. Decrease in accounts receivable Decrease in inventory $ 8,600 11,600 Increase in prepaid rent 1,600 Decrease in salaries payable 2,600 Increase in accounts payable 5,600 Increase in income tax payable. 6,600 Required: Prepare the operating activities section of the statement of cash flows for Software Associates using the indirect method. (List cash outflows and any decrease in cash as negative amounts.) SOFTWARE ASSOCIATES Statement of Cash Flows (partial) For the Year Ended December 31, 2021 Cash Flows from Operating Activities: Adjustments to reconcile net income to net cash flows from operating activities: Net cash flows from operating activities $606,000 555,600 $ 50,400 $ ences Mc 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, 2021 Net sales Gain on sale of land $2,450,000 7,500 Total revenues 2,457,500 Expenses: Cost of goods sold $1,575,000 600,000 18,000 Operating expenses Depreciation expense Interest expense Income tax expense Total expenses 19,000 65,000 2,277,000 $ 180,500 Net income VIRTUAL GAMING SYSTEMS Balance Sheets December 31 Assets Current assets: Cash Accounts receivable Inventory Prepaid rent Long-term assets: Investments Land Equipment Accumulated depreciation Total assets $835,500 Liabilities and Stockholders' Equity Current liabilities: $27,500 Accounts payable Interest payable. 3,500 Income tax payable i 29,000 Long-term liabilities: Notes payable. 255,000 Stockholders' equity: Common stock 295,000 225,500 Retained earnings $835,500 Total liabilities and stockholders' equity Additional Information for 2021: 1. Purchase additional Investment in stocks for $80,000. 2. Sell land costing $47.500 for $55,000, resulting in a $7.500 gain on sale of land.