MARTINEZ COMPANY COMPARATIVE BALANCE SHEET ACCOUNTS AS OF DECEMBER 31 2017 $69,300 154,900 2016 ebit Balances Cash Accounts Receivable Inventory Debt investments (available-for-sale) Equipment Buildings Land $51,100 130,000 60,700 85,100 48,100 146,000 24,700 $611,100 $545,700 75,600 54,500 70,600 146,000 40,200 Totals Credit Balances Allowance for Doubtful Accounts Accumulated Depreciation-Equipment Accumulated Depreciation-Buildings Accounts Payable Income Taxes Payable Long-Term Notes Payable Common Stock Retained Earnings $7,900 13,900 28,200 60,600 10,000 70,000 260,000 95,100 $611,100 $545,700 $10,100 20,900 37,300 66,100 12,100 62,000 310,000 92,600 Totals Additional data: Additional data: 1. Equipment that cost $9,900 and was 60% depreciated was sold in 2017 2. Cash dividends were declared and paid during the year 3. Common stock was issued in exchange for land 4. Investments that cost $34,700 were sold during the year 5. There were no write-offs of uncollectible accounts during the year. Martinez's 2017 income statement is as follows Sales revenue Less: Cost of goods sold Gross profit Less: Operating expenses (includes depreciation expense and bad debt expense) Income from operations Other revenues and expenses $952,300 604,800 347,500 247,700 99,800 Gain on sale of investments $15,100 (3,000 12,100 Loss on sale of equipment Income before taxes Income taxes Net income -111,900 44,500 $67,400 (a) Compute net cash provided by operating activities under the direct method. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Net cash flow from operating activities (b) Prepare a statement of cash flows using the indirect method. (Show amounts that decrease cash flow with either a -signe e.g. (15,000).) MARTINEZ COMPANY Statement of Cash Flows For the Year Ended December 31, 2017 Cash Flows from Operating Activities 67400 Net Income Adjustments to reconcile net income to Net Cash Used by Operating Activities Depreciation Expense Gain on Sale of Investments Sale of Equipment Increase in Accounts Receivable (Net) Increase in Inventory Increase in Accounts Payable Increase in Income Taxes Payable (22700) (14900) 5500 2100 Cash Flows from Investing Activities Purchase of Investments Sale of Investments Purchase of Equipment Loss on Sale of Equipment Net Cash Provided by Investing Activities Cash Flows from Financing Activities Cash Dividends Paid Payment of Long-term Notes Payable Issuance of Common Stock Net Cash Used by Financing Activities