XS Supply Company is developing its annual financial statements at December 31, current year. The statements are complete except for the statement of cash flows. The completed comparative balance sheets and income statement are summarized below: Current Year Prior Year Balance sheet at December 31 Cash Accounts receivable Merchandise inventory Property and equipment Less: Accumulated depreciation $ 34,100 35,200 43,000 121,100 (30,300) $203, 100 $ 36,200 1,400 39,300 $ 28,900 28,400 38,100 100, 400 (25,100) $170, 700 $ 27,400 1,500 44,100 72,700 Accounts payable Wages payable Note payable, long-term Common stock and additional paid-in capital Retained earnings 89,100 37,100 $203, 100 25,000 $170, 700 Income statement for current year Sales Gain on sale of equipment Cost of goods sold Other expenses Net income $121,000 1,000 71,000 38,900 $ 12,100 Additional data: a. Bought equipment for cash, $31,700. Sold equipment with original cost of $11,000, accumulated depreciation of $8,000, for $4,000 cash. b. Paid $4,800 on the long-term note payable. c. Issued new shares of stock for $16,400 cash. d. No dividends were declared or paid. e. Other expenses included depreciation, $13,200; wages, $13,100; taxes, $6,100; and other, $6,500. 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. Required: 1. Prepare the statement of cash flows for the year ended December 31, current year, using the indirect method. (List cash outflows as negative amounts.) Answer is not complete. XS SUPPLY COMPANY Statement of Cash Flows For the Year Ended December 31, Current Year Cash flows from operating activities: Net income Adjustments to reconcile net income to net cash provided by operating activities: Depreciation expense Gain on sale of equipment $ 12,100 Increase in accounts receivable Increase in merchandise inventory Increase in accounts payable Decrease in wages payable 1,000 X 6,800 X 4,900 X 8,800 (100) 21,400 33,500 Cash flows from investing activities: Cash payments to purchase equipment Cash received from sale of equipment Cash flows from financing activities: Cash receipts from issuing stock Cash payments on long-term note 0 Cash balance, January 1, current year Cash balance, December 31, current year $ 0