Western Environmental Inc. Comparative Balance Sheet Information June 30 2023 2022 Cash $ 92,560 $ 51,200 Accounts receivable (net) 104,000 76,000 Inventory 80,240 116,240 Prepaid expenses 6,560 6,320 Equipment 164,000 152,000 Accumulated depreciation 35,200 20,000 Accounts payable 32,800 40,000 Wages payable 10,000 20,800 Income taxes payable 2,960 4,400 Notes payable (long-term) 56,000 92,000 Common shares 284,000 224,000 Retained earnings 26,400 560 Western Environmental Inc. Income Statement For Year Ended June 30, 2023 Sales $ 794,000 Cost of goods sold 480,400 Gross profit $ 313,600 Operating expenses: Depreciation expense $ 70,400 Other expenses 80,480 Total operating expenses 150,880 Profit from operations $ 162,720 Gain on sale of equipment 4,000 Profit before taxes $ 166,720 Income taxes 62,720 Profit $ 104,000

Required: Use the Western Environmental Inc. information given below to prepare a statement of cash flows for the year ended June 30, 2023, using the indirect method. (List any deduction in cash and cash outflows as negative amounts.) A note is retired at carrying value. The only changes affecting retained earnings during 2023 are profit and cash dividends paid. New equipment is acquired during 2023 for $75,200. The profit on sale of equipment costing $63,200 during 2023 is $4,000. Prepaid expenses and wages expense affect other expenses on the income statement. All sales and purchases of merchandise were on credit.