MONTGOMERY INCORPORATED Comparative Balance Sheets At December 31 Current Year Prior Year Assets Cash Accounts receivable, net $ 53,800 $ 53,900 13,400 16,400 120,100 187,300 66,500 (30,100) 94,800 165,100 56,100 (20,700) ces 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 $ 223,700 $ 200,500 $ 32,000 600 32,600 159,400 31,700 $ 223,700 $ 34,400 800 35,200 147,900 17,400 $ 200,500 MONTGOMERY INCORPORATED Income Statement For Current Year Ended December 31 Sales Cost of goods sold Gross profit Salaries expense Depreciation expense Income before taxes Income tax expense Net income $ 60,900 (25,300) 35,600 7,400 9,400 18,800 4,500 $ 14,300 Additional Information on Current-Year Transactions a. No dividends are declared or paid. b. Issued additional stock for $11,500 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. (Amounts to be deducted should be indicated by a minus sign.) Cash flows from operating activities MONTGOMERY, INCORPORATED Statement of Cash Flows (Indirect Method) For Current Year Ended December 31 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 $ 0 Cash flows from investing activities