ShinFu Electronic, Inc.€™s income statement and comparative balance sheets appear as follows:

Additional information related to business activities during 2014:
1. All accounts payable pertain to inventory purchases, and accrued liabilities pertain to other operating expenses.
2. The original cost of the equipment sold was $80,400. New equipment was purchased and 5,000 common shares at $14 per share were issued as a partial payment.
3. ShinFu purchased some land and borrowed $20,000 from a mortgage company as a partial payment.
4. ShinFu declared a dividend on December 15 to be paid on January 15, 2015.
Requirements
1. Identify source and use of cash for each account in the Balance Sheet.
2. Calculate the cash receipt from the sale of equipment and the cost of the new equipment, using T-accounts to show your calculations.
3. Calculate the amount of cash dividend declared and cash dividend paid, using T-accounts to show your calculations.
4. Prepare a cash flow statement, using the indirect method.
5. Prepare the cash flow from operating activities section by using the direct method.

ShinFu Electronic, Inc. Income Statement For the Year Ended December 31, 2014 Sales Revenue Cost of Goods Sold 610,000 366,000) 244,000 Depreciation Expense Patent Depreciation Expense Equipment Salaries Expense Otner Operating Expenses Interest Expense Loss on Sale of Equipment Income Before Income Taxes Income Tax Expense Net Income 1,500 15,200 62,000 83,300 14,500 12,500 189,000 55,000 16,500 S 38,500 ShinFu Electronic, Inc. Balance Sheet As of December 31 SOURCE/ USE 2014 2013 Cash Accounts Receivable Inventory Prepaid Expenses Equipment Accumulated Depreciation Land Patents Total 12,500 S 15,200 43,500 68,400 32,500 72,700 68 4,100 (45,000) (67,200) 11,000 189,800 145,200 183,000135,000 12,500 460,600 $355,200 48,600 Accounts Payable Accrued Liabilities Salaries Payable Dividends Payable Interest Payable Income lax Payable Mortgage Common Shares 26,200 8,600 32,000 36,200 58,900 14,500 10,200 7,200 12,20018,000 24,200 20,000 240,000170,000 30,500 $460,600 $355,200 Retained Earnings 58,500 Total