Prepare a statement of cash flows using the indirect method.

Additional information:

Dividends declared and paid were $4,000.

During the year equipment was sold for $8,500 cash. This equipment cost $18,000 originally and had a book value of $8,500 at the time of sale.

All depreciation expense is in the selling expense category. Depreciation expense amounted to $7,500.

All sales and purchases are on account.

1. The financial statements of ABC Co. appear below ABC Co Comparative Balance Sheet December 31 2014 Assets Cash Accounts receivable Merchandise inventor Property, plant and equipment Accumulated depreciation 2015 $ 31,000 28,000 25,000 60,000 $ 13,000 14,000 35,000 78,000 Total $122,000 Liabilities and Stockholders Equit Accounts payable Income taxes payable Bonds pavable Common stock Retained earnin $ 27,000 5,000 27,000 18,000 45,000 $122,000 $ 23,000 8,000 35,000 14,000 Total ABC Co Income Statement For the Year Ended Dec 31, 2015 Sales Cost of goods sold Gross profit Selling expenses Administrative expenses Income from operations Interest expense Income before income taxes Income tax expense Net income $220,000 180.000 40,000 $14,000 22,000 18,000 17,000 Additional information: a. Dividends declared and paid were $4,000 b. During the year equipment was sold for $8,500 cash. This equipment cost $18,000 originally and had a book value of $8,500 at the time of sale c. All depreciation expense is in the selling expense category. Depreciation expense amounted to $7,500 d. All sales and purchases are on account