Please help with the answers for the questions from Waterways' case WCP-13 as the attachments.
Waterways Continuing Problem Waterways Continuing Problem (This is a continuation of the Waterways Problem from Chapters 1 through 12.) WCPIB Waterways prepared the balance sheet and income statement for the irrigation installation division for 2017. Now the company also needs to prepare a cash flow state- ment for the same division. The comparative balance sheets for Waterways Corporation's Irrigation Installation Division for the years 2016 and 2017 and the income statement for the year 2017 are presented below. Additional information: 1. E" Waterways sold a company vehicle for $24,000. The vehicle had been used for 10 years. It cost $80,000 when purchased and had a 10-year life and a $6,000 salvage value. Straight-line depreciation was used. Waterways purchased with cash new equipment costing $209,200. . Prepaid expenses increased by $33,960 WATERWAYS CORPORATIONINSTALLATION DIVISION Balance Sheets December 31 Assets Current assets Cash Accounts receivable Work in process Inventory Prepaid expenses Total current assets Property, plant, and equipment Land Buildings Equipment Furnishings Accumulated depreciation Total property, plant, and equipment Total assets Liabilities and Stockholders' Equity Current liabilities Accounts payable Income taxes payable Wages payable Interest payable Other current liabilities Revolving bank loan payable Total current liabilities Long-term liabilities Note payable Total liabilities Stockholders' equity Common stock Retained earnings Total stockholders' equity Total liabilities and stockholders' equity 2017 $ 836,797 680,750 702,159 16,766 76,550 2,313,022 300,000 450,000 929,400 40,416 (482,523) 1,237,293 $3,550,315 $ 157,095 101,344 4,517 1,187 14,515 15,000 293,658 140,000 433,658 1,250,000 1,866,657 3,116,657 $3,550,315 2016 $ 746,681 542,685 7,500 42,590 1,339,456 300,000 450,000 800,200 40,416 (485,204) 1,105,412 $2,444,868 $ 128,360 79,989 1,984 15,246 225,579 225,579 1,250,000 969,289 2,219,289 $2,444,868 15 16 Waterways Continuing Problem Instructions WATERWAYS CORPORATIONINSTALLATION DIVISION Income Statement For the Year Ending December 31, 2017 Sales $5,536,077 Less: Cost of goods sold 3,132,777 Gross prot 2,403,300 Operating expenses Advertising $ 50,000 Insurance 400,000 Salaries and wages 584,640 Depreciation 71,319 Other operating expenses 21,200 Total operating expenses 1,127,159 Income from operations 1,276,141 Other income Gain on sale of equipment 18,000 Other expenses Interest expense (12,187) Net other income and expenses 5,813 Income before income tax 1,281,954 Income tax expense 384,586 Net income 35 897,368 For the year 2017: (a) Prepare a statement of cash flows using the indirect method. *(b) Prepare a statement of cash flows using the direct method. (c) Determine free cash ow
