OB). 2 w from vities PR 13-1A Statement of cash flows-indirect method The comparative balance sheet of Cromme Inc. for December 31, 2016 and 2015, is shown as follows: Dec 31, 2016 Dec 31, 2015 Assets Cash ... $ 625,760 227,840 641,760 0 328,000 705,120 (166,400) $2,362,080 $ 585,920 208,960 617.120 240,000 0 553,120 (148,000) $2,057,120 Accounts receivable (net) Inventories Investments Land Equipment. Accumulated depreciation--equipment Total assets Liabilities and Stockholders' Equity Accounts payable (merchandise creditors) Accrued expenses payable (operating expenses) Dividends payable. Common stock, $4 par... Paid-in capital: Excess of issue price over par-common stock Retained earnings...... Total liabilities and stockholders' equity.. $ 424,480 42,240 24,000 150,000 417,500 1,303,860 $2,362,080 $ 404,960 52,640 19,200 100,000 280,000 1,200,320 $2,057,120 Additional data obtained from an examination of the accounts in the ledger for 2016 are as follows: a. The investments were sold for $280,000 cash. b. Equipment and land were acquired for cash. c. There were no disposals of equipment during the year. d. The common stock was issued for cash. e. There was a $199,540 credit to Retained Earnings for net income. f. There was a $96,000 debit to Retained Earnings for cash dividends declared. Instructions Prepare a statement of cash flows, using the indirect method of presenting cash flows from operating activities. CROMME INC. Statement of Cash Flows For the Year Ended December 31, 2016 Cash flows from operating activities: Net income Adjustments to reconcile net income to net cash flow from operating activities Depreciation Changes in current operating assets and liabilities: Net cash flow from operating activities Cash flows from investing activities Net cash flow used for investing activities Cash flows from financing activities: Net cash flow from financing activities Increase in cash Cash at the beginning of the year Cash at the end of the year 3 Optional: Balance, Dec. 31, 2016 625,760 227,840 641,760 CROMME INC Spreadsheet (Work Sheet) for Statement of Cash Flows For the Year Ended December 31, 2016 Balance, Transactions Dec. 31, 2015 Debit Credit Cash 585,920 Accounts receivable (net) 208,960 Inventories 617.120 Investments 240,000 Land Equipment 553,120 Accum. depr. - equipment (148,000) Accounts payable (404,960) Accrued expenses payable (52,640) Dividends ble (19,200) Common stock. $2 par (100.000) Pard-in capital in excess of par (280,000) Retained earnings (1.200 320) Totals Operating activities Net income Depreciation Gain on sale of investments Increase in accounts receivable Increase in inventories increase in accounts payable Decrease in accrued expenses payable Investing activities Purchase of equipment Purchase of land Sale of investments Financing activities Declaration of cash dividends Sale of common stock Increase in duidends payable Net increase in cash Totais 328,000 705,120 (166,400) (424.480) (42.240) (24,000) (150,000) (417,500) (1.303,860) 9 0 1 32 73 74 75 76 77 79 79 BO 81 82 83 84 85 86