Palindrome Corp has prepared the following comparative balance sheet statements for 2015 and 2016: 2016 2015 Cash 569,000 245,000 Accounts Receivable 427,000 316,000 Inventory 272,000 297,000 Prepaid Expenses 55,000 64,000 Plant Assets 2,830,000 2,508,000 Accumulated Depreciation (960,000) (852,000) Patent 103,000 122,000 3,296,000 2,700,000

Accounts Payable 248,000 267,000 Accrued Liabilities 102,000 78,000 Loan Payable 100,000 500,000 Preferred Stock 358,000 58,000 Additional Paid-in Capital - Preferred 112,000 12,000 Common Stock 1,164,000 1,164,000 Retained Earnings 1,212,000 621,000 3,296,000 2,700,000

The Accumulated Depreciation account has been credited only for the depreciation expense for the period. The Retained Earnings account has been charged for dividends of $210,000 and credited for the net income for the year. The income statement for 2016 is as follows: Sales Revenue 2,451,000 Cost of Sales 934,000 Gross Profit 1,517,000 Operating Expenses 716,000 Net Income 801,000

a) From the information above, prepare a statement of cash flows [indirect method] for Palindrome for the year ended December 31, 2016. b) From the information above, prepare a schedule of cash flows provided by operating activities using the direct method.