Flounder Inc., a greeting card company, had the following statements prepared as of December 31, 2017. FLOUNDER INC. COMPARATIVE BALANCE SHEET AS OF DECEMBER 31, 2017 AND 2016 12/31/17 12/31/16 Cash $6,000 $7,100 Accounts receivable 62,600 51,100 Short-term debt investments (available-for-sale) 35,400 18,100 Inventory 39,700 59,600 Prepaid rent 5,000 4,000 Equipment 154,200 128,700 Accumulated depreciation-equipment (35,300) (24,800 ) Copyrights 45,500 49,800 Total assets $313,100 $293,600 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 Retained earnings Total liabilities & stockholders' equity $45,500 4,000 7,900 8,000 60,600 100,000 30,000 57,100 $313,100 $39,800 6,000 3,900 9,900 69,500 100,000 30,000 34,500 $293,600 FLOUNDER INC. INCOME STATEMENT FOR THE YEAR ENDING DECEMBER 31, 2017 Sales revenue Cost of goods sold Gross profit Operating expenses Operating income Interest expense $11,300 Gain on sale of equipment 2,100 Income before tax Income tax expense Net income $340,975 176,300 164,675 119,600 45,075 9,200 35,875 7,175 $28,700 Additional information: 1. Dividends in the amount of $6,100 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 direct method. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis FLOUNDER INC. Statement of Cash Flows