E12-18 LO12-2, 12-4, 12-6 12 626-685.indd 668 Preparing a Statement of Cash Flows (Indirect Method) Computer Service and Repair was started five years ago by two college roommates. The company's com- parative balance sheets and income statement are presented below, along with additional information. Prior Current Year Year Balance Sheet at December 31 Cash $3,300 $4,000 Accounts receivable 700 500 100 50 Prepaid expenses Equipment 350 Accumulated depreciation (50) Wages payable Short-term note payable Common stock Retained earnings Income Statement for Current Year Service revenue Depreciation expense Salaries expense Other expenses Net income $ $ 4,400 350 300 1,000 2.750 $ 4,400 $ 34,000 (50) (30,000) (3,650) 300 Final PDF CHAPTER 12 Statement of Cash Flows $ 0 0 $4,550 $1,100. 0 1,000 2,450 $4,550 Additional Data: a. Prepaid expenses relate to rent paid in advance. b. Other expenses were paid in cash. c. Purchased equipment for $350 cash at the beginning of the current year and recorded $50 of deprecia- tion expense at the end of the current year. d. At the end of the current year, the company signed a short-term note payable to the bank for $300. Required: Prepare the statement of cash flows for the year ended December 31, current year, using the indirect method. 09/25/21 06:52 PM