Information from the Balance Sheet and statement of income are given below for Martinez Inc., a private company reporting under ASPE, for the year ended December 31. Martinez Inc.

Comparative Balance Sheet, at December 31 2017 2016

Cash $92,150 $46,150

Accounts receivable 90,700 36,150

Inventory 122,000 102,550

Investments in land 85,100 107,150

Property, plant, and equipment 285,200 201,000

Accumulated depreciation (48,260) (40,000)

$626,890 $454,000

Accounts payable 52,700 48,410

Accrued liabilities 11,700 19,010

Notes payable 140,000 70,000

Common shares 250,000 195,000

Retained earnings 172,490 121,580

$626,890 $454,000

Revenues

Sales 286,500

Gain on Disposal of Equipment 7,750

$294,250

Expenses

Cost of goods sold $95,650

epreciation expense 56,100

Operating expenses 14,270

Income tax expense 36,800

Interest expense 2,710 205,530

Profit $88,720

Additional information:

1.Investments in land were sold at a gain during 2017.

2.Equipment costing $55,200 was sold for $16,110, resulting in a gain.

3.Common shares were issued in exchange for some equipment during the year. No other shares were issued.

4.The remaining purchases of equipment were paid for in cash.

Prepare a cash flow statement for the year ended December 31, 2017 using the direct method.