Cash Flows from (Used for) Operating Activities The income statement disclosed the following items for the year: Depreciation expense Gain on disposal of equipment $57,000 33,240 497,300 Net income The changes in the current asset and liability accounts for the year are as follows: Increase (Decrease) Accounts receivable $8,880 Inventory (5,050) Prepaid insurance (1,890) Accounts payable (6,020) Income taxes payable 1,890 Dividends payable 1,330 a. Prepare the Cash Flows from (used for) Operating Activities section of the statement of cash flows, using the indirect method. Use the minus sign to indicate cas outflows, cash payments, decreases in cash, or any negative adjustments. Statement of Cash Flows (partial) Cash flows from. (used for) operating activities: Dividends payable 1,330 a. Prepare the Cash Flows from (used for) Operating Activities section of the statement of cash flows, using the indirect method. Use them outflows, cash payments, decreases in cash, or any negative adjustments. Statement of Cash Flows (partial) Cash flows from (used for) operating activities: Net income 497,300 Adjustments to reconcile net income to net cash flows from (used for) operating activities: Depreciation expense 57,000 Gain on disposal of equipment Changes in current operating assets and liabilities: Increase in accounts receivable Decrease in inventory Decrease in prepaid insurance Decrease in accounts payable Increase in income taxes payable Net cash flows from operating activities Feedback 5,050 1,890 -6,020 1,890 Profitability Ratios The following selected data were taken from the financial statements of Vidahill Inc. for December 31, 20Y7, 2016, and 20Y5: December 31 2017 2016 2015 Total assets $319,000 $287,000 $255,000 Notes payable (8% interest) 110,000 110,000 110,000 Common stock 44,000 44,000 44,000 Preferred 7% stock, $100 par 22,000 22,000 22,000 (no change during year) Retained earnings 133,400 91,400 66,000 The 2017 net income was $43,540, and the 2016 net income was $26,940. No dividends on common stock were declared between 2015 and 2017. Preferred dividends were declared and paid in full in 2016 and 2017. a. Determine the return on total assets, the return on stockholders' equity, and the return on common stockholders' equity for the years 2016 and 2017. Round percentages to one decimal place. 2017 2016 Return on total assets % % Return on stockholders' equity Return on common stockholders' equity 96 % % % b. The profitability ratios indicate that the company's profitability has improved. Since the rate of return on total assets is less than the return