5 QS 16-19 Indirect: Preparing statement of cash flows LO P1, P2, P3 - 16 points MONTGOMERYINC. Comparative Balance Sheets December 31, 2018 and 2017 2018 2017 Assets Cash Accounts receivable, net Inventory Total current assets Equipment Accum. depreciation-Equipment Total assets Liabilities and Equity Accounts payable Salaries payable Total current liabilities Equity Common stock, no par value Retained earnings Total liabilities and equity $ 30,400 30,550 10,050 12,150 eBook Ask Print References 90,1007, 150 130, 550 112, 850 49,900 41,500 22,500) $157,950 (15, 300) $159,050 $ 23,900 25,400 600 24.400 26,000 500 110, 000 23,550 100,000 13, 050 $157,950 $139, 050 MONTGOMERY INC. Income Statement For Year Ended December 31, 2018 Sales Cost of goods sold Gross profit Operating expenses $ 45, 575 (18,950) 26,625 Depreciation expense $ 7,200 Retained earnings Total 1iabilities and equity 13, 050 $157,950 $139,850 23, 550 16 points Incone Statenent For Year Ended December 31, 2018 Sales Cost of goods sold Gross profit Operating expenses 45,575 (18,950) 26,625 Book Ack PInt Pelerences Depreciation expense 7,200 Other expenses Total operat ing expense Incone before taxes Incose tax expense Net Incone 12,750 13,875 10,500 Additional Information a. No dividends are declared or paid in 2018 b. Issued additional stock for $10,000 cash in 2018 c. Purchased equipment for cash in 2018 no equipment was sold in 2018 1. Use the above financial statements and additional information to prepare & statement of cash flows for the year ended December 31 2018, using the indirect method. (Amounts to be deducted should be indlicated by a minus sign.) MONTGOMERY, INC Statement of Cash Flows Indirect Method) For Year Ended December 31.2018 5 MONTGOMERY, INC Statement of Cash Flows (Indirect Method) For Year Ended December 31, 2018 C ash flows from operating activities 16 points 10,500 Net income Adjustments to reconcile net income to net cash provided by operations Income statement items not affecting cash Depreciation expense Decrease in accounts receivable e Book Changes in current operating assets and liabilities Ask Print References 10,500 C ash flows from investing activities 0 C ash flowes from financing activities 0 10,500 Cash balance at beginning of year Cash balance at end of year 10,500