Statement of cash flows—indirect method OBJ. 2 The comparative balance sheet of Cromme Inc. for December 31, 2016 and 2015, is shown as follows:

Dec. 31, 2016 Dec. 31, 2015 Assets Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 625,760 $ 585,920 Accounts receivable (net) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 227,840 208,960 Inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 641,760 617,120 Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 0 240,000 Land . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 328,000 0 Equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 705,120 553,120 Accumulated depreciation—equipment . . . . . . . . . . . . . . . . . . . . . . . . . . (166,400) (148,000)

Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $2,362,080 $2,057,120 Liabilities and Stockholders’ Equity Accounts payable (merchandise creditors) . . . . . . . . . . . . . . . . . . . . . . . . $ 424,480 $ 404,960 Accrued expenses payable (operating expenses) . . . . . . . . . . . . . . . . . . 42,240 52,640 Dividends payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24,000 19,200 Common stock, $4 par . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 150,000 100,000 Paid-in capital: Excess of issue price over par—common stock . . . . . . 417,500 280,000 Retained earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,303,860 1,200,320 Total liabilities and stockholders’ equity . . . . . . . . . . . . . . . . . . . . . . . $2,362,080 $2,057,120 Additional data obtained from an examination of the accounts in the ledger for 2016 are as follows:

a. The investments were sold for $280,000 cash.

b. Equipment and land were acquired for cash.

c. There were no disposals of equipment during the year.

d. The common stock was issued for cash.

e. There was a $199,540 credit to Retained Earnings for net income.

f. There was a $96,000 debit to Retained Earnings for cash dividends declared.

Instructions Prepare a statement of cash flows, using the indirect method of presenting cash flows from operating activities.