E23-11.

(SCFIndirect Method)

(LO 2) Condensed financial data of Pat Metheny Company for 2017 and 2016 are presented below.

PAT METHENY COMPANY COMPARATIVE BALANCE SHEET AS OF DECEMBER 31, 2017 AND 2016
	2017	2016
Cash	$1,800	$1,150
Receivables	1,750	1,300
Inventory	1,600	1,900
Plant assets	1,900	1,700
Accumulated depreciation	(1,200)	(1,170)
Long-term investments (held-to-maturity)	1,300	1,420
	$7,150	$6,300
Accounts payable	$1,200	$900
Accrued liabilities	200	250
Bonds payable	1,400	1,550
Common stock	1,900	1,700
Retained earnings	2,450	1,900
	$7,150	$6,300

PAT METHENY COMPANY INCOME STATEMENT FOR THE YEAR ENDED DECEMBER 31, 2017
Sales revenue	$6,900
Cost of goods sold	4,700
Gross margin	2,200
Selling and administrative expense	930
Income from operations	1,270
Other revenues and gains
Gain on sale of investments	80
Income before tax	1,350
Income tax expense	540
Net income	810
Cash dividends	260
Income retained in business	$550

Additional information:

During the year, $70 of common stock was issued in exchange for plant assets. No plant assets were sold in 2017.

Instructions

Prepare a statement of cash flows using the indirect method.