Michaels Company had the following information available at the end of 2014.

	Michaels Company
	Comparative Balance Sheets
	As of December 31, 2014 and 2013
	2014	2013
Cash	$10,780	$3,240
Accounts Receivable	20,980	13,120
Short-term investments	21,390	31,300
Inventory	41,680	36,870
Prepaid rent	2,990	13,850
Prepaid insurance	2,330	960
Supplies	1,270	780
Land	124,230	173,190
Buildings	350,370	350,370
Accumulated depreciation- buildings	(105,570)	(88,430)
Equipment	524,820	400,640
Accumulated deprecation- equipment	(130,880)	(113,130)
Patents	45,910	51,840
Total assets	$910,300	$874,600
Accounts payable	$22,740	$31,790
Income taxes payable	5,050	4,560
Salaries and wages payable	5,650	3,280
Short-term notes payable	10,810	10,810
Long-term notes payable	60,520	70,850
Bonds payable	400,680	400,680
Premium on bonds payable	14,990	26,970
Common Stock	240,960	219,090
Paid-in Capital in excess of par-common stock	25,150	17,570
Retained earnings	123,750	89,000
Total liabilites and stockholders' equity	$910,300	$874,600

	Michael S Company
	Income Statement and Dividend Information
	For the year ended December 31, 2014
Sales Revenue		$1,160,900
Cost of Good Sold		748,530
		412,370
Gross Margin
Operating expenses
Selling expenses	$79,880
Admin expenses	157,410
Depreciation/Amortization exp.	40,820
Total operating expenses		278,110
income from operations		134,260
other revenues/expenses
gain on sale of land	8,400
Gain on sale of short-term investment	4,280
Dividend revenue	2,860
Interest expense	(52,110)	(36,570)
Income before taxes		97,690
Income tax expense		40,150
Net income		57,540
Dividends to common stockholders		(22,790)
To retained earnings		$34,750

Prepare a statement of cash flows for Michaels Company using the direct method accompanied by a reconciliation schedule. Assume the short-term investments are classified as available-for-sale.