Presented below are the 2016 income statement and comparative balance sheets for Santana Industries.

SANTANA INDUSTRIES

Income Statement For the Year Ended December 31, 2016 ($ in thousands)

Sales revenue $ 14,850

Service revenue 4,000

Total revenue $ 18,850

Operating expenses:

Cost of goods sold 7,500

Selling 2,700

General and administrative 1,800

Total operating expenses 12,000

Operating income 6,850

Interest expense 230

Income before income taxes 6,620

Income tax expense 2,800

Net income $ 3,820

Balance Sheet Information ($ in thousands)

Dec. 31, 2016 Dec. 31, 2015

Assets: Cash $ 7,650 $ 2,470 .

Accounts receivable 3,100 2,500

Inventory 4,600 3,300 .

Prepaid rent 180 360

Plant and equipment 15,100 12,600

Less: Accumulated depreciation (5,400 ) (4,800 )

Total assets $ 25,230 $ 16,430

Liabilities and Shareholders Equity:

Accounts payable $ 2,000 $ 1,400

Interest payable 130 0

Deferred service revenue 860 630

Income taxes payable 580 860

Loan payable (due 12/31/2018) 5,600 0

Common stock 10,300 10,300

Retained earnings 5,760 3,240

Total liabilities and shareholders' equity $ 25,230 $ 16,430

Additional information for the 2016 fiscal year ($ in thousands):

1. Cash dividends of $1,300 were declared and paid.

2. Equipment costing $4,600 was purchased with cash.

3. Equipment with a book value of $800 (cost of $2,100 less accumulated depreciation of $1,300) was sold for $800.

4. Depreciation of $1,900 is included in operating expenses. Required: Prepare Santana Industries' 2016 statement of cash flows, using the indirect method to present cash flows from operating activities.