The income statement, balance sheet, and additional information for Virtual Gaming Systems are provi

The income statement, balance sheet, and additional information for Virtual Gaming Systems are provided.VIRTUAL GAMING SYSTEMSIncome StatementFor the year ended December 31, 2012 Revenues$3,100,000 Gain on sale of land2,700 Total revenues3,102,700 Expenses: Cost of goods sold$ 1,680,000 Operating expenses608,000 Depreciation expense23,700 Interest expense24,700 Income tax expense70,400 Total expenses2,406,800 Net income$695,900 VIRTUAL GAMING SYSTEMSBalance SheetDecember 3120122011 Assets Current assets: Cash$ 667,100 $ 146,000 Accounts receivable82,000 94,000 Inventory148,000 140,000 Prepaid rent4,500 6,500 Long-term assets: Investments188,000 110,000 Land214,000 260,000 Equipment234,000 213,000 Accumulated depreciation(132,700) (109,000) Total assets$ 1,404,900 $ 860,500 Liabilities and Stockholders’ Equity Current liabilities: Accounts payable$ 34,000 $ 93,000 Interest payable4,700 3,200 Income tax payable21,000 29,000 Long-term liabilities: Notes payable251,000 230,000 Stockholders’ equity: Common stock343,000 290,000 Retained earnings751,200 215,300 Total liabilities and stockholders’ equity$ 1,404,900 $ 860,500 Additional Information for 2012:1.Purchase additional investment in stocks for $78,000.2.Sell land costing $46,000 for $48,700, resulting in a $2,700 gain on sale of land.3.Purchase $21,000 in equipment by borrowing $21,000 with a note payable due in three years. No cash is exchanged in the transaction.4.Declare and pay a cash dividend of $160,000.5.Issue common stock for $53,000.Required:Prepare the statement of cash flows using the indirect method. Disclose any noncash transactions in an accompanying note. (Amounts to be deducted should be indicated with minus sign. Omit the “$” sign in your response.)

 

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