Condensed financial data of Ayayai Company for 2017 and 2016 are presented below.

AYAYAI COMPANY

COMPARATIVE BALANCE SHEET

AS OF DECEMBER 31, 2017 AND 2016

2017

2016

Cash

$1,780

$1,140

Receivables

1,760

1,310

Inventory

1,570

1,900

Plant assets

1,890

1,720

Accumulated depreciation

(1,190

)

(1,150

)

Long-term investments (held-to-maturity)

1,280

1,410

$7,090

$6,330

Accounts payable

$1,220

$890

Accrued liabilities

210

250

Bonds payable

1,430

1,540

Common stock

1,940

1,730

Retained earnings

2,290

1,920

$7,090

$6,330

AYAYAI COMPANY

INCOME STATEMENT

FOR THE YEAR ENDED DECEMBER 31, 2017

Sales revenue

$6,670

Cost of goods sold

4,640

Gross margin

2,030

Selling and administrative expenses

930

Income from operations

1,100

Other revenues and gains

Gain on sale of investments

80

Income before tax

1,180

Income tax expense

550

Net income

630Cash dividends

260

Income retained in business

$370

Additional information:

During the year, $70of common stock was issued in exchange for plant assets. No plant assets were sold in 2017.

Show statement of cash flows using the indirect method. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).)

AYAYAI COMPANY

Statement of Cash Flows

(Indirect Method)

$

Adjustments to reconcile net income to

$

$

$