MONTGOMERY INCORPORATED Comparative Balance Sheets At December 31 Current Year Prior Year Assets Cash Accounts receivable, net $ 32,300 10,600 95,100 138,000 52,700 (23,800) $ 32,400 13,000 75,100 120,500 44,500 (16,500) Inventory Total current assets Equipment Accumulated depreciation-Equipment Total assets Liabilities and Equity Accounts payable Salaries payable Total current liabilities Equity Common stock, no par value Retained earnings Total liabilities and equity MONTGOMERY INCORPORATED Income Statement For Current Year Ended December 31 Sales Cost of goods sold $ 46,200 (19,200) Gross profit Salaries expense Depreciation expense Income before taxes Income tax expense 27,000 5,600 7,300 14,100 3,400 $ 10,700 $ 166,900 $ 148,500 $ 25,300 500 25,800 117,300 23,800 $ 166,900 $ 27,400 600 28,000 107,400 13,100 $ 148,500 Net income Additional Information on Current-Year Transactions a. No dividends are declared or paid. b. Issued additional stock for $9,900 cash. G. Purchased equipment for cash; no equipment was sold. Information on Current-Year Transactions a. No dividends are declared or paid. b. Issued additional stock for $9,900 cash. c. Purchased equipment for cash; no equipment was sold. 1. Use the above information to prepare a statement of cash flows for the current year using the indirect method. Note: Amounts to be deducted should be indicated by a minus sign. MONTGOMERY, INCORPORATED Statement of Cash Flows (Indirect Method) For Current Year Ended December 31 Cash flows from operating activities Adjustments to reconcile net income to net cash used in operating activities: Income statement items not affecting cash Changes in current operating assets and liabilities Cash flows from investing activities Cash flows from financing activities Cash balance at beginning of year Cash balance at end of year $ $ 0 $ 0 $ 0 $ 0