Exercise 23-14

Sheffield Inc., a greeting card company, had the following statements prepared as of December 31, 2017.

SHEFFIELD 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 depreciationequipment		(34,800	)		(25,300	)
Copyrights		46,300			50,400
Total assets		$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		100,000			100,000
Contributed capital, common stock		30,000			30,000
Retained earnings		58,100			36,200
Total liabilities & stockholders equity		$313,900			$295,400

SHEFFIELD INC. INCOME STATEMENT FOR THE YEAR ENDING DECEMBER 31, 2017
Sales revenue				$339,075
Cost of goods sold				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 indirect method. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).)