Question

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	$	16,250
Service revenue		5,400
Total revenue			$	21,650
Operating expenses:
Cost of goods sold		8,200
Selling		3,400
General and administrative		2,500
Total operating expenses				14,100
Operating income				7,550
Interest expense				300
Income before income taxes				7,250
Income tax expense				3,500
Net income			$	3,750

Balance Sheet Information ($ in thousands)	Dec. 31, 2016			Dec. 31, 2015
Assets:
Cash	$	8,350		$	3,100
Accounts receivable		4,500			3,200
Inventory		6,000			4,000
Prepaid rent		250			500
Plant and equipment		16,500			14,000
Less: Accumulated depreciation		(6,100	)		(5,500	)
Total assets	$	29,500		$	19,300
Liabilities and Shareholders’ Equity:
Accounts payable	$	3,400		$	2,100
Interest payable		200			0
Deferred service revenue		1,000			700
Income taxes payable		650			1,000
Loan payable (due 12/31/2015)		7,000			0
Common stock		11,000			11,000
Retained earnings		6,250			4,500
Total liabilities and shareholders' equity	$	29,500		$	19,300

Additional information for the 2016 fiscal year ($ in thousands):
1.	Cash dividends of $2,000 were declared and paid.
2.	Equipment costing $6,000 was purchased with cash.
3.	Equipment with a book value of $1,500 (cost of $3,500 less accumulated depreciation of $2,000) was sold for $1,500.
4.	Depreciation of $2,600 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.)

Answer 1