David Jones owns a small trucking operations. The bookkeeper presented Jones with the following income statements and balance sheets for 2012 and 2013.

Income Statement

2013 2012

Revenues $191,400 $182,600

Operating Expenses:

Depreciation $26400 $26400

Fuel $77000 $46200

Drivers' salaries $44,000 $35,200

Tax and license's $22,000 $17,600

Repairs $30,800 $19,800

Miscellaneous $2200 $ 202 400 $ 1 100 $ 146 300

Income (loss) ($11,000) $36,300

Balance Sheets 2013 2012

Cash $22,000 $4,400

Accounts receivable $8800 $ 26,400

Net fixed assets $198,000 $224,400

Total Assets $228,800 $255,200

Accounts payable $30,800 $22,000

Accrued salaries $8800 $5,500

Other accruals $3,300 $1,100

Long term debt $100,100 $129,800

Jones, capital $85,800 $96,800

Total Liabilities $228,800 $255,200

Jones does not understand how the company can be $17 ,600 ahead of last year in terms of cash on hand and yet show an $11,000 loss for the year.

Required:

Prepared a Cash Flow statement (indirect heat method) to use in explaining this to David Jones.