E. Prepare a statement of cash flow on both direct and indirect method 2019 2018

Assets: Cash 245,000 70,000 Accounts receivable, net 95,000 90,000 Inventory 52,000 60,000 Trading securities 40,000 30,000 Prepaid expenses 13,000 20,000 Property, plant & equipment 800,000 600,000 Accumulated depreciation (90,000) (60,000) Total Assets 1,155,000 810,000 Liabilities & Equity Accounts payable 44,000 50,000 Accrued liabilities 11,000 20,000 Interest payable 15,000 5,000 Long-term Notes Payable 75,000 50,000 Common stock 210,000 200,000 Additional paid in capital 350,000 260,000 Paid in capital stock options 65,000 30,000 Retained earnings 385,000 195,000 1,155,000 810,000 Sales 2,150,000 Cost of goods sold 1,215,000 Gross profit 935,000 Operating expenses 560,000 Operating income 375,000 Unrealized gains-trading securities 10,000 Pre-tax income 385,000 Income taxes 75,000 Net income 310,000 a. Stock option expense of $35,000 was recognized in 2019 b. Equipment of $200,000 was purchased using cash and $100,000 common stock, with $90,000 excess of par