Exercise 17-07

The following three accounts appear in the general ledger of Herrick Corp. during 2020.

Equipment
Date				Debit		Credit		Balance
Jan. 1		Balance						161,200
July 31		Purchase of equipment		68,100				229,300
Sept. 2		Cost of equipment constructed		54,600				283,900
Nov. 10		Cost of equipment sold				49,100		234,800
Accumulated DepreciationEquipment
Date				Debit		Credit		Balance
Jan. 1		Balance						70,700
Nov. 10		Accumulated depreciation on equipment sold		31,200				39,500
Dec. 31		Depreciation for year				24,200		63,700
Retained Earnings
Date				Debit		Credit		Balance
Jan. 1		Balance						104,200
Aug. 23		Dividends (cash)		15,800				88,400
Dec. 31		Net income				66,700		155,100

From the postings in the accounts, indicate how the information is reported on a statement of cash flows using the indirect method. The loss on disposal of plant assets was $4,900. (Hint: Cost of equipment constructed is reported in the investing activities section as a decrease in cash of $54,600.) (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).)