The comparative balance sheets of Sally Fagan Design Studio, Inc., at June 30, 2016, and 2015, and

Question:

The comparative balance sheets of Sally Fagan Design Studio, Inc., at June 30, 2016, and 2015, and transaction data for fiscal 2016, are as follows:

Transaction data for the year ended June 30, 2016, follows:
a. Net income, $70,600
b. Depreciation expense on equipment, $13,200
c. Purchased long-term investment with cash, $14,600
d. Sold land for $39,900, including $6,900 loss
e. Acquired equipment by issuing long-term note payable, $13,600
f. Paid long-term note payable, $59,000
g. Received cash for issuance of common stock, $6,900
h. Paid cash dividends, $37,700
i. Paid short-term note payable by issuing common stock, $7,000
Requirements
1. Prepare the statement of cash flows of Sally Fagan Design Studio, Inc., for the year ended June 30, 2016, using the indirect method to report operating activities. Also prepare the accompanying schedule of noncash investing and financing activities. All current accounts except Notes Payable, short-term, result from operating transactions.
2. Prepare a supplementary schedule showing cash flows from operations by the direct method. The accounting records provide the following: collections from customers, $231,600; interest received, $1,200; payments to suppliers, $95,100; payments to employees, $39,100; payments for income tax, $12,100; and payment of interest, $4,400.