Exercise 23-13 Kingbird Inc., a greeting card company, had the following statements prepared as of December 31, 2017. KINGBIRD INC. COMPARATIVE BALANCE SHEET AS OF DECEMBER 31, 2017 AND 2016 12/31/17 12/31/16 Cash $6,100 $6,900 Accounts receivable 62,500 51,000 Short-term debt investments (available-for-sale) 34,800 18,100 Inventory 39,600 60,200 Prepaid rent 4,900 4,000 Equipment 154,500 130,100 Accumulated depreciation-equipment (34,800) (25,300) Copyrights Total assets 46,300 50,400 $313,900 $295,400 Accounts payable $46,000 $40,200 Income taxes payable 4,000 6,000 Salaries and wages payable 8,100 4,000 Short-term loans payable 8,000 10,000 Long-term loans payable 59,700 69,000 Common stock, $10 par Contributed capital, common stock Retained earnings Total liabilities & stockholders' equity 100,000 100,000 30,000 30,000 58,100 36,200 $313,900 $295,400 KINGBIRD INC. INCOME STATEMENT FOR THE YEAR ENDING DECEMBER 31, 2017 Sales revenue Cost of goods sold $339,075 175,000 Gross profit 164,075 Operating expenses 119,900 Operating income 44,175 Interest expense $11,300 Gain on sale of equipment 2,000 9,300 Income before tax 34,875 Income tax expense 6,975 Net income $27,900 Additional information: 1. Dividends in the amount of $6,000 were declared and paid during 2017. 2. Depreciation expense and amortization expense are included in operating expenses. 3. No unrealized gains or losses have occurred on the investments during the year. 4. Equipment that had a cost of $19,900 and was 70% depreciated was sold during 2017. Prepare a statement of cash flows using the direct method. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).) KINGBIRD INC. Statement of Cash Flows $ $ +A