Below is an example of a statement of cash flows. Explain the indirect method and how the cash is moving within this company. What are the differences between the indirect and direct method?

Statement of Cash Flows Indirect Method For the Year Ending 12/31/2015 Cash Flows from Operating Activities: Net income Add (deduct items) not affecting cash: Depreciation expense Gain on sale of equipment 43,987 2,150 (150) (3,500) 2,800 45,287 Increase in accounts payable Net cash provided by operating activities Cash Flows from Investing Activities: Proceeds from sale of equipment Purchase of land Net cash used for investing activities 25,000 (60,000) (35,000) Cash Flows from Financing Activities: New long-term borrowing Payment of long-term debt Purchase of treasury stock Payment of dividends Net cash used for financing activities 350 (200) (175) (50) (75) Increase (decrease) in cash Cash balance, January 1, 2015 Cash balance, December 31, 2015 10,212 35,620 45,832