PA$12-6($Algo$)$ Preparing and Interpreting a Statement of Cash Flows $($Direct Method$)[$LO $12-3,$ LO $12-4,$

LO $12-5,[$O $12-6]$

Heads Up Company was started several years ago by two hockey instructors. The company's comparative balance sheets and income

statement follow, along with additional information.

Additlonel Dete:

a$.$ Bought new hockey equipment for cash, $$600.$

b$.$ Borrowed $$1,000$ cash from the bank during the year.

c$.$ Accounts Payable includes only purchases of services made on credit for operating purposes. Because there are no liability

accounts relating to income tax, assume that this expense was fully paid in cash.

Requlred:

Prepare the statement of cash flows for the current year ended December $31$ using the direct method. $($Amounts to be deducted

should be Indicated with a minus sign.$)$