MONTGOMERY, INC Statement of Cash Flows (Indirect Method) For Year Ended December 31, 2018 Cash flows from operating activities Net income Adjustments to reconcile net income to net cash provided by operations: Changes in current operating assets and liabilities Depreciation expense Decrease in accounts receivable Decrease in accounts payable Decrease in salaries payable Increase in inventory Net cash used in operating activities Cash flows from investing activities 0) Cash flows from financing activities 0 0 Cash balance at beginning of year Cash balance at end of year Additional Information a. No dividends are declared or paid in 2018 b. Issued additional stock for $10,300 cash in 2018 c. Purchased equipment for cash in 2018; no equipment was sold in 2018 1. Use the above financial statements and additional information to prepare a statement of cash flows for the year ended December 31, 2018, using the indirect method. (Amounts to be deducted should be indicated by a minus sign.) 2018 2017 Assets Cash Accounts receivable, net Inventory Total current assets Equipment Accum. depreciation-Equipment Total assets Liabilities and Equity Accounts payable Salaries payable Total current liabilities Equity Common stock, no par valuee Retained earnings Total 1iabilities and equity $ 38,200 38,700 13,400 77,500 129,600 45,800 10,800 96,800 145,800 53,600 24,200) (16,900) $175,200$158,500 $ 25,70028,100 500 400 26,100 28,600 119,000 10,900 $175,200 $158,500 129,300 19,800 MONTGOMERY INC Income Statement For Year Ended December 31, 2018 Sales Cost of goods sold Gross profit Operating expenses $40,300 (16,700 23,600 Depreciation expense $ 7,300 5,000 Other expenses Total operating expense Income before taxes Income tax expense Net income 12,300 11,300 2,400 $ 8,900