The comparative balance sheets of Village Company follow: VILLAGE COMPANY Comparati

The comparative balance sheets of Village Company follow: VILLAGE COMPANY Comparative Balance Sheets December 31, 20X2 and 20X1 Dec. 31, 20X2 Dec. 31, 20X1 Cash $
5,000 $ 7,000 Accounts receivable (net) 12,000 18,000 Merchandise inventory 35,000 28,000 Property, plant, & equipment 40,000 30,000 Less: Accumulated
depreciation (17,000) (10,000) Total assets $ 75,000 $ 73,000 Accounts payable* $ 25,000 $ 21,000 Income taxes payable 4,000 1,000 Common stock 24,000 24,000
Retained earnings 22,000 27,000 Total liabilities & stock, equity $ 75,000 $ 73,000 *Relate to purchases of merchandise The firm’s accrual-basis income
statement revealed the following data: sales, $120,000; cost of goods sold, $80,000; selling and administrative expenses, $25,000; depreciation expense, $7,000;
and income taxes, $3,000. (There was no interest expense.) Dividends declared and paid during 20X2 totaled $10,000. Finally, Village purchased $10,000 of equipment
for cash on August 14. Determine the increase or decrease in cash during 20X2. Prepare a statement of cash flows by using the direct method.