Critical Thinking Mini Case or shareholder of Systems Unlimited Inc., Phil Wang, is perplexed. The 2017 income statement d a healthy profit of $280 thousand. Yet, when Linda Lewis, the bank manager and a friend of Phils, to let him know that the bank had just reviewed the March 31, 2017, statements, she had said, "Phil twanted to give you a heads-up. We're extremely concerned about the message your 2017 statement h flows is sending. We may have to call in the secured loan unless the new company manager, Mar- we I just Shewart, has some reasonable explanations. I'm phoning her next. en asked, Martha Shewart says, "That's correct, Linda. We sold some of the unsecured manut t ac- 's in Other expenses. Don't worry, one down turing equipment. It cost $245 thousand and we got $150 thousand. No, it didn't go for book value incurred a loss of $50 thousand where on the income statement? It Linda, a friend of mine, contract and it will be delivered in April." After the conversation, Martha Shewart slams the pl and thinks, " onald Trump, is going to sell us cheaper equipment. It's on order. I signed I own 20% of the shares in this company; how dare anybody question my actions?! Systems Unlimited Inc. Comparative Balance Sheet Information March 31 (thousands) Systems Unlimited Inc. Income Statement For Year Ended March 31, 2017 thousands 2017 2016 $30 $ 75 50 80 100 305 $1,400 950 $ 450 Cost of goods sold. Gross profit. Operating expenses: Accounts receivable (net) Inventory. Property, plant, and equipment (net) Accounts payable Income tax payable Bank loan payable (secured)... Common shares... Retained earnings 490 244 Depreciation expense. 40 14 120 115 Total operating expenses... Profit from operations Income tax expense Profit 120 $ 330 50 $ 280 2 0 390 390 300 Required 1. Prepare a statement of cash flows (applying the indirect or direct method)* for the year ended March 31, 2017 2. Using the elements of critical thinking described on the inside front cover, identify and discuss the problem, goal, facts, and conclusion, while keeping in mind that it is best not to jump to onclusions