The 2008 comparative balance sheet and income statement of Digital Subscriptions, Inc.. follow.

Digital Subscriptions had no noncash investing and financing trans- actions during 2008. During the year, there were no sales of land or equipment, no issuances of notes payable, no retirements of stock, and no treasurv stock transactions.

Requirements 

1. Prepare the 2008 statement of cash flows, formatting operating activities by the indirect method.

2. How will what you learned in this problem help you evaluate an investment?

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DIGITAL SUBSCRIPTIONS, INC. Comparative Balance Sheet December 31, 2008 2007 Increase (Decrease) Current assets: Cash and cash equivalents $ 26,700 S 18,700 $ 8.000 Accounts receivable Inventories 46,500 43,100 3.400 84,300 89,900 (5,600) Plant assets: 35,100 10,000 25.100 100,900 93,700 .200 Total assets $293.500 $255.400 $38.100 Land Equipment, net Current liabilities: Accounts payable Accrued liabilities Long-term liabilities: Notes payable Stockholders' equity: Common stock Retained earnings Total liabilities and stockholders' equity S 31.100 18,100 S 29,800 S 1.300 18,700 (600) 55,000 65,000 (10,000) 131.100 122,300 8,800 58,200 19.600 38.600 $293.500 $255.400 $38.100