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 Accounts Receivable Merchandise Inventory Property and Equipment Less: Accumulated Depreciation $ 34,000 35,000 41,000 121,000 (30,000) $ 29,000 28,000 38,000 100,000 (25,000) $201,000 $170,000 Accounts Payable Wages Payable Note Payable, Long-Term Contributed Capital Retained Earnings $ 36,000 1,200 38,000 88,600 37,200 $ 27,000 1,400 44,000 72,600 25,000 $ 201,000 $170,000 Income Statement (Current year) Sales Cost of Goods Sold Other Expenses $120,000 70,000 37,800 Net Income $ 12,200 Additional Data: a. Bought equipment for cash, $21,000. b. Paid $6,000 on the long-term note payable. c. Issued new shares for $16,000 cash. d. No dividends were declared or paid. e. Other expenses included depreciation, $5,000; wages, $20,000; taxes, $6,000; other, $6,800. 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 using the indirect method. (Amounts to be deducted should be indicated by a minus sign.) XS SUPPLY COMPANY Statement of Cash Flows For the Year Ended December 31 Cash flows from operating activities: Adjustments to reconcile net income to net cash provided by operating activities: 0 0 Cash flows from investing activities: 0 Cash flows from financing activities: 0 Net increase in cash during the year Cash balance, January 1 Cash balance, December 31 $