Problem 12-08A

Presented below are the financial statements of a Company.

Sage Hill Company Comparative Balance Sheets December 31 Assets 2022 2021 Cash $ 56,000 $ 32,000 Accounts receivable 32,000 22,400 Inventory 44,800 32,000 Property, plant, and equipment 96,000 124,800 Accumulated depreciation (51,200) (38,400) Total $1??,600 $1?2,eoo Liabilities and Stockholders' Equity Accounts payable $ 30,400 $ 24,000 Income taxes payable 11,200 12,800 Bonds payable 2?,200 52,800 Common stock 28,800 22,400 Retained earnings 80,000 60,800 Total $1??,600 $1?2,800 Sage Hi|| Company Income Statement For the Year Ended December 31. 2022 Sales revenue $387,200 Cost of goods sold 280,000 Gross profit 107,200 Selling expenses $28,800 Administrative expenses 9500 38,400 Income from operations 68,800 Interest expense 4,800 Income before income taxes 64,000 Income tax expense 12,800 Net income $ 51,200 Additional data: 1. Depreciation expense was $28,000. 2. Dividends declared and paid were $32,000. 3. During the year equipment was sold for $13,600 cash. This equipment cost $28,800 originally and had accumulated depreciation of $15,200 at the time of sale. Further analysis reveals the following. Accounts payable pertain to merchandise suppliers. All operating expenses except for depreciation were paid in cash. All depreciation expense is in the selling expense category. All sales and purchases are on account. +\\L0l\\Jll Prepare a statement of cash flows fer Sage Hill Company using the direct method. (Shall Sage Hill Company Statement of Cash Flows