F. Prepare a statement of cash flow on both direct and indirect method 2017 2016 Assets: Cash Accounts receivable, net Inventory Prepaid expenses Property, palnt & equipment Accumulated depreciation 215,000 87,000 74,000 12,000 780,000 (110,000) 1,058,000 70,000 65,000 60,000 20,000 600,000 (60,000) 755,000 Total Assets Liabilities & Equity Accounts payable Accrued liabilities Taxes payable Long-term Notes Payable Common stock Additional paid in capital Retained earnings 40,000 40,000 4,000 32,000 26,000 15,000 100,000 200,000 326,000 359,000 1,058,000 200,000 276,000 195,000 755,000 Total liabilities and equity Sales Cost of goods sold Gross profit 1,400,000 780,000 620,000 Operating exoeaSes Pre-tax income Income taxes Net income 290,000 330,000 66,000 264,000 a. Stock option expense of $50,000 was recognized in 2017 b. Equipment of $180,000 was purchased using $100,000 note payable and cash