XS Supply Company is developing its annual financial statements at December 31. The statements are complete except for the statement of cash flows. The completed comparative balance sheets and income statement are summarized: Current Year Prior Year Balance Sheet at December 31 Cash $ 49,175 $ 35,900 Accounts Receivable 41,450 33,600 Merchandise Inventory Property and Equipment 48,450 44,200 131,500 118,000 Less: Accumulated Depreciation (37,350) (29,500) $233,225 $202,200 Accounts Payable Wages Payable Note Payable, Long-Term Contributed Capital Retained Earnings $ 37,810 $ 28,000 2,905 3,300 41,600 53,200 99,300 77,100 51,610 40,600 $233,225 $202,200 Income Statement (Current year) Sales $155,500 Cost of Goods Sold 90,190 Other Expenses Net Income 54,300 $ 11,010 Additional Data: a. Bought equipment for cash, $13,500. b. Paid $11,600 on the long-term note payable. c. Issued new shares for $22,200 cash. d. No dividends were declared or paid. e. Other expenses included depreciation, $7,850; wages, $29,500; taxes, $6,750; other, $10,200. f. Accounts Payable includes only inventory purchases made on credit. Because there are no liability accounts relating to taxes or other expenses, assume that these expenses were fully paid in cash. XS SUPPLY COMPANY Statement of Cash Flows For the Year Ended December 31 Cash flows from operating activities: Net income Adjustments to reconcile net income to net cash provided by operating activities: Depreciation expense Increase in accounts receivable Increase in merchandise inventory Increase in accounts payable Decrease in wages payable $ 7,850 $ 11,010 7,850 Net cash provided by operating activities 18,860 Cash flows from investing activities: Cash payments to purchase equipment Net cash used in investing activities Cash flows from financing activities: Cash payments on long-term note Cash receipts from issuing shares Net cash provided by financing activities Net increase in cash during the year Cash balance, January 1 Cash balance, December 31 0 0 $ 0