P17-11A The comparative balance sheets for Strackman Lux Company as of December 31 are presented below. STRACKMAN LUX COMPANY Comparative Balance Sheets December 31 Assets 2012 2011 Cash $ 71,000 $ 45,000 Accounts receivable 44,000 62,000 Inventory 151,450 142,000 Prepaid expenses 15,280 21,000 Land 105,000 130,000 Equipment 228,000 155,000 Accumulated depreciation equipment (45,000) (35,000) Buildings 200,000 200,000 Accumulated depreciation buildings (60,000) (40,000) Total $709,730 5680,000 Liabilities and Stockholders' Equity Accounts payable S 47,730 $ 40,000 Bonds payable 260,000 300,000 Common stock, Si par 200,000 160,000 Retained earnings 202,000 180,000 Total $709,730 5680,000 Additional information: 1. Operating expenses include depreciation expense of $42.000 and charges from prepaid expenses of $5,720. 2. Land was sold for cash at book value. 3. Cash dividends of $15,000 were paid. 4. Net income for 2012 was S37,000. 5. Equipment was purchased for $95,000 cash. In addition, equipment costing $22,000 with a book value of $10,000 was sold for $6,000 cash. Cash from operations S105,000 6. Bonds were converted at face value by issuing 40,000 shares of Si par value common stock. Instructions Prepare a statement of cash flows for the year ended December 31, 2012, using the indirect method