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Digiread Technologies Ltd. (DTL) is a privately held distributor of e-readers and tablets. The Calgary-based company is well established and is currently managed by its

Digiread Technologies Ltd. (DTL) is a privately held distributor of e-readers and tablets. The Calgary-based company is well established and is currently managed by its founder, Erin Jacobs. The companys financial statements are presented below, together with some additional information.

DIGIREAD TECHNOLOGIES LTD. Statement of Income As at December 31, 2016
Sales $51,510,000
Cost of goods sold 35,088,000
Gross profit 16,422,000
Wage expense 4,080,000
Depreciation expense 1,224,000
Interest expense 1,938,000
Income tax expense 1,632,000
Net income from operations 7,548,000
Gain on sale of equipment 612,000
Net income $8,160,000
DIGIREAD TECHNOLOGIES LTD. Statement of Financial Position As at December 31
2016 2015
Assets
Current assets:
Cash $15,810,000 $8,670,000
Accounts receivable (net) 11,730,000 15,810,000
Inventory 17,238,000 19,380,000
Total current assets 44,778,000 43,860,000
Equipment 40,188,000 30,600,000
Accumulated depreciation, equipment (6,732,000) (6,528,000) )
Total Assets $78,234,000 $67,932,000
Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable $12,138,000 $7,140,000
Wages payable 1,224,000 1,020,000
Total current liabilities 13,362,000 8,160,000
Bonds payable 21,420,000 26,520,000
Common shares 14,280,000 9,180,000
Retained earnings 29,172,000 24,072,000
Total Liabilities and Shareholders' Equity $78,234,000 $67,932,000
DIGIREAD TECHNOLOGIES LTD. Other Selected Financial Information for the Year Ended December 31, 2016
1. Total sales in 2016 were consistent with the prior years and the companys dividend policy has remained consistent for the past five years.
2. During 2016, DTL sold a piece of equipment for $2,142,000. The equipment had originally cost $2,550,000 and had a net carrying amount of $1,530,000 at the time of sale.
3. On August 1, 2016, DTLs board of directors approved the retirement of bonds with a face value of $5,100,000 through the issuance of common shares.

Prepare a statement of cash flows using the indirect method.

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