2016 $ 68,728 Waterway Industries Comparative Balance Sheets December 31 Assets 2017 Cash $ 114,736 Accounts receivable 124,676 Inventory 159.750 Prepaid expenses 40,328 Long-term investments 195,960 Plant assets 404.700 Accumulated depreciation (71,000) Total $969,150 53,960 146,047 36,920 154,780 344,350 (73,840 $730,945 Liabilities and Stockholders' Equity Accounts payable Accrued expenses payable Bonds payable Common stock Retained earnings Total $ 144,840 23,430 156,200 312,400 332.280 $969.150 $ 95,566 29,820 207,320 248,500 149.739 $730,945 - $551,613 Waterway Industries Income Statement Data For the Year Ended December 31, 2017 Sales revenue Less: Cost of goods sold $192,353 Operating expenses, excluding depreciation 17,622 Depreciation expense 66,030 Income tax expense 38,738 Interest expense 6,717 Loss on disposal of plant assets 10,650 Net Income 332,110 $ 219,503 Additional information: 1 2. 3. New plant assets costing $142.000 were purchased for cash during the year. Old plant assets having an original cost of $81,650 and accumulated depreciation of $68,870 were sold for $2,130 cash Bonds payable matured and were paid off at face value for cash. A cash dividend of $36,962 was declared and paid during the year, 4 Waterway Industries Statement of Cash Flows For the Year Ended December 31, 2017 Cash Flows from Operating Activities Net Income Adjustments to reconcile net income to Net Cash used by Operating Activities Loss on Disposal of Plant Assets > Increase in Accounts Receivable Increase in Inventory Increase in Prepaid Expenses Increase in Accounts Payable Decrease in Accrued Expenses Payable Depreciation Exped