Exercise 12-7 Shown below are comparative balance sheets for Pharoah Company. Pharoah Company Comparative Balance Sheets December 31 Assets 2017 2016 Cash Accounts receivable Inventory Land $ 126,820 164,120 311,455 149,200 484,900 (123,090 ) $1,113,405 $ 41,030 141,740 352,485 186,500 373,000 (59,680 ) $1,035,075 Equipment Accumulated depreciation equipment Total $ 72,735 279,750 Liabilities and Stockholders' Equity Accounts payable Bonds payable Common stock ($1 par) Retained earnings Total 402,840 $ 80,195 373,000 324,510 257,370 $1,035,075 358,080 $1,113,405 Additional information: 1. Net income for 2017 was $173,445. 2. Depreciation expense was $63,410. 3. Cash dividends of $72,735 were declared and paid. 4. Bonds payable amounting to $93,250 were redeemed for cash $93,250. 5. Common stock was issued for $78,330 cash. 6. No equipment was sold during 2017. 7. Land was sold for its book value. Prepare a statement of cash flows for 2017 using the indirect method. (Show amounts that decrease cash flow with either a - sign e.g. -15,000, or in parenthesis e.g. (15,000)). Pharoah Company Statement of Cash Flows Adjustments to reconcile net income to