Problem 4-11 Statement of cash flows; indirect method [LO4-8]

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	$	14,450
Service revenue		3,600
Total revenue			$	18,050
Operating expenses:
Cost of goods sold		7,300
Selling		2,500
General and administrative		1,600
Total operating expenses				11,400
Operating income				6,650
Interest expense				210
Income before income taxes				6,440
Income tax expense				2,600
Net income			$	3,840

Balance Sheet Information ($ in thousands)	Dec. 31, 2016			Dec. 31, 2015
Assets:
Cash	$	7,450		$	2,290
Accounts receivable		2,700			2,300
Inventory		4,200			3,100
Prepaid rent		160			320
Plant and equipment		14,700			12,200
Less: Accumulated depreciation		(5,200	)		(4,600	)
Total assets	$	24,010		$	15,610
Liabilities and Shareholders Equity:
Accounts payable	$	1,600		$	1,200
Interest payable		110			0
Deferred service revenue		820			610
Income taxes payable		560			820
Loan payable (due 12/31/2015)		5,200			0
Common stock		10,100			10,100
Retained earnings		5,620			2,880
Total liabilities and shareholders' equity	$	24,010		$	15,610

Additional information for the 2016 fiscal year ($ in thousands):
1.	Cash dividends of $1,100 were declared and paid.
2.	Equipment costing $4,200 was purchased with cash.
3.	Equipment with a book value of $600 (cost of $1,700 less accumulated depreciation of $1,100) was sold for $600.
4.	Depreciation of $1,700 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. (Amounts to be deducted should be indicated with a minus sign. Enter your answers in thousands.)