Exercise 23-14 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 Accounts receivable Short-term debt investments (available-for-sale) Inventory Prepaid rent Equipment Accumulated depreciation-equipment Copyrights $6,100 61,600 34,900 39,900 5,000 154,100 (35,000 ) 45,500 $312,100 $7,000 51,500 18,100 60,400 4,100 130,300 (24,900 ) 50,500 $297,000 Total assets Accounts payable Income taxes payable Salaries and wages payable Short-term loans payable Long-term loans payable Common stock, $10 par Contributed capital, common stock $45,800 4,000 8,100 7,900 60,500 100,000 30,000 $39,900 6,000 4,000 10,000 69,300 100,000 30,000 Common stock, $10 par Contributed capital, common stock Retained earnings Total liabilities & stockholders' equity 100,000 30,000 55,800 $312,100 100,000 30,000 37,800 $297,000 KINGBIRD INC. INCOME STATEMENT FOR THE YEAR ENDING DECEMBER 31, 2017 Sales revenue Cost of goods sold Gross profit Operating expenses Operating income Interest expense Gain on sale of equipment Income before tax $333,000 174,000 159,000 119,500 39,500 $11,500 2,000 9,500 30,000 6,000 $24,000 Income tax expense Net income 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 $20,100 and was 70% depreciated was sold during 2017. Prepare a statement of cash flows 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).) KINGBIRD INC. Statement of Cash Flows Adjustments to reconcile net income to $ - - - - | |