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	Previous Year
Balance Sheet at December 31
Cash	$ 35,370	$ 30,450
Accounts Receivable	36,600	28,800
Inventory	42,600	38,800
Equipment	133,000	108,000
Accumulated DepreciationEquipment	(31,600)	(25,800)
Total Assets	$ 215,970	$ 180,250
Accounts Payable	$ 37,600	$ 27,800
Salaries and Wages Payable	970	1,250
Notes Payable (long-term)	45,200	52,000
Common Stock	93,400	73,400
Retained Earnings	38,800	25,800
Total Liabilities and Stockholders Equity	$ 215,970	$ 180,250
Income Statement
Service Revenue	$ 128,000
Cost of Goods Sold	74,000
Other Expenses	41,000
Net Income	$ 13,000

Additional Data:

1. Bought equipment for cash, $25,000.
2. Paid $6,800 on the long-term notes payable.
3. Issued new shares of stock for $20,000 cash.
4. No dividends were declared or paid.
5. Other expenses included depreciation, $5,800; salaries and wages, $20,800; taxes, $6,800; utilities, $7,600.
6. 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.

Required:

1. Prepare the statement of cash flows for the current year ended December 31 using the indirect method. (Amounts to be deducted should be indicated with a minus sign.)

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 Changes in Current Assets and Current Liabilities Depreciation Expense Increase in Accounts Receivable Increase in Inventory Increase in Accounts Payable Decrease in Salaries and Wages payable olo 0 Net Cash Provided by Operating Activities Cash Flows from Investing Activities: Cash payments on Notes Payable (long-term) Cash Payments to Purchase Equipment Net Cash Used in Investing Activities Cash Flows from Financing Activities: Cash payments on Notes Payable (long-term) Cash Receipts from Issuing Stock Cash Balance, January 1 Net Cash Used in Financing Activities Net Increase in Cash during the Year Cash Balance, January 1 Cash Balance, December 31 0 $ 0