The comparative statements of financial position for Hinckley SA include the following information.

Additional data related to 2022 are as follows.

1. Equipment that had cost €11,000 and was 40% depreciated at time of disposal was sold for €2,500.

2. €10,000 of the long-term note payable was paid by issuing ordinary shares.

3. Cash dividends paid were €5,000.

4. On January 1, 2022, the building was completely destroyed by a flood. Insurance proceeds on the building were €32,000.

5. Equity investments were sold at €1,700 above their cost.

6. Cash was paid for the acquisition of equipment.

7. A long-term note for €16,000 was issued for the acquisition of equipment.

8. Interest of €2,000 and income taxes of €6,500 were paid in cash.

Instructions

Prepare a statement of cash flows using the indirect method.

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December 31 Debt Balances 2022 2021 Investments € -0- € 3,000 Buildings -0- 29,750 Equipment 45,000 20,000 Patents 5,000 6,250 Inventory 12,000 9,000 Accounts receivable 12,250 10,000 Cash 33,500 13,000 €107,750 €91,000 Credit Balances Share capital-ordinary € 43,000 €33,000 Retained earmings 20,750 6,000 Allowance for doubtful accounts 3,000 4,500 Accumulated depreciation-equipment Accumulated depreciation-buildings 2,000 4,500 -0- 6,000 Accounts payable 5,000 3,000 Dividends payable -0- 5,000 Long-term notes payable 31,000 25,000 Notes payable, short-term (non-trade) 3,000 4,000 €107,750 €91,000