Preparing a Statement of Cash Flows}

SDPS Inc. provides airport transportation services in northern Quebec. A statement of earnings for 2018 and statements of financial position for 2018 and 2017 appear below.

\section*{Required:}
1. Prepare a statement of cash flows, using the indirect method to compute net cash flow from operating activities.
2. CONCEPTUAL CONNECTION Explain what has been responsible for the decrease in cash.
3. CONCEPTUAL CONNECTION Determine how SDPS financed its increase in net property, plant, and equipment during a period in which it had a net loss.
Problem

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ASSETS SDPS Inc. Statements of Financial Position December 31, 2018 and 2017 2018 2017 Current assets: Cash Accounts receivable Supplies, fuel Total current assets Property, plant, and equipment Equipment, vehicles $ 40,000 126,000 11,000 $ 82,000 109.000 25,000 177,000 216,000 $ 524,000 409,000 Accumulated depreciation (174,000) (136,000) Net property, plant, and equipment 350,000 273,000 Total assets $527,000 $489,000