Prepare a statement of cash flows using the DIRECT method accompanied by a reconciliation schedule.

Cash payments: (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15, 000).) Reconciliation Schedule Reconciliation of Net Income to Adjustments to reconcile net income to Click if you would like to Show Work for this question: Open Show Work Problem 23-4 Novak Company had the following information available at the end of 2017. NOVAKCOMPANY COMPARATIVE BALANCE SHEETS AS OF DECEMBER 31, 2017 AND 2016 2017 Cash Accounts receivable Short-term investments Inventory Prepaid rent Prepaid insurance Supplies 2016 $3,980 12,920 29,850 34,950 11,990 90 75 $10,090 20,320 21,970 41,660 3,020 2,100 1,010 123,940 346,530 (104,430) 527,070 (131,260 ) 44,900 $906,920 Land Buildings Accumulated depreciation-buildings Equipment Accumulated depreciation equipment Patents 175,430 346,530 (87,260 ) 402,150 (111,670 ) 50,370 $869,405 Total assets Accounts payable Income taxes payable Salaries and wages payable Short-term notes payable Long-term notes payable Bonds payable Premium on bonds payable Common stock Paid-in capital in excess of par-common stock Retained earnings $21,940 5,030 5,000 10,010 59,560 397,360 21,860 237,890 24,840 123,430 $32,020 3,960 2,980 10,010 70,180 397,360 25,065 220,760 17,470 89,600 Common stock Paid-in capital in excess of par-common stock Retained earnings Total liabilities and stockholders' equity 237,890 24,840 123,430 $906,920 220,760 17,470 89,600 $869,405 NOVAK COMPANY INCOME STATEMENT AND DIVIDEND INFORMATION FOR THE YEAR ENDED DECEMBER 31, 2017 Sales revenue Cost of goods sold $1,160,530 747,740 412,790 $78,510 155,480 42,230 276,220 136,570 Gross margin Operating expenses Selling expenses Administrative expenses Depreciation/Amortization expense Total operating expenses Income from operations Other revenues/expenses Gain on sale of land Gain on sale of short-term investment Dividend revenue Interest expense Income before taxes Income tax expense 8,080 3,960 2,380 (51,950) (37,530 ) 99,040 39,610 59,430 (25,600 ) $33,830 Net income Dividends to common stockholders To retained earnings Prepare a statement of cash flows for Novak Company using the direct method accompanied by a reconciliation schedule. Assume the short-term investments are debt securities, classified as available-for-sale. (Show amounts in the investing and financing sections that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).) NOVAK COMPANY Statement of Cash Flows (Direct Method) Cash receipts: Cash payments