Balance Sheet	2012	2011
cash	10,000	4,000
accounts receivable	20,500	12,950
short-term investment	22,000	30,000
inventory	42,000	35,000
prepaid rent	3,000	12,000
prepaid insurance	2,100	900
supplies	1,000	750
land	125,000	175,000
buildings	350,000	350,000
accumulated depreciation - buildings	-105,000	-87,500
equipment	525,000	400,000
accumulated depreciation - equipment	-130,000	-112,000
patents	45,000	50,000
total assets	910,600	871,100
accounts payable	22,000	32,000
income taxes payable	5,000	4,000
salaries and wages payable	5,000	3,000
short-term notes payable	10,000	10,000
long-term notes payable	60,000	70,000
bonds payable	400,000	400,000
premium on bonds payable	20,303	25,853
common stock	240,000	220,000
paid-in capital in excess of par- common stock	25,000	17,500
retained earnings	123,297	88,747
total liabilities and stockholders' equity	910,600	871,100
Income Statement
sales revenue		1,160,000
cost of goods sold		748,000
gross margin		412,000
operating expense
selling expense	79,200
administrative expenses	156,700
depreciation/amortization expense	40,500
total operating expenses		276,400
income from operations		135,600
other revenues/expenses
gain on sale of land	8,000
gain on sale of short-term investment	4,000
dividend revenue	24,000
interests expense	-51,750	-37,350
income before taxes		98,250
income tax expense		39,400
net income		58,850
dividends to common stockholders		-24,300
to retained earnings		34,550

Prepare a statement of cash flows for this company using the direct method accompanied by a reconciliation schedule. Assume the short-term investments are classified as available-for-sale.