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Problem 23-1 The following are Martinez Corp.'s comparative balance sheet accounts at December 31, 2017 and 2016, with a column showing the increase (decrease) from

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Problem 23-1 The following are Martinez Corp.'s comparative balance sheet accounts at December 31, 2017 and 2016, with a column showing the increase (decrease) from 2016 to 2017 COMPARATIVE BALANCE SHEETS Increase (Decrease) $111,800 2017 $807,900 1,130,100 1,850,400 3,324,100 2016 Cash Accounts receivable Inventory Property, plant, and equipment Accumulated depreciation Investment in Myers Co Loan receivable $696,100 (36,200) 143,100 329,000 1,166,300 1,707,300 2,995,100 (1,163,100) (1,032,700 (130,400) 308,700 250,800 $6,508,900 277,600 31,100 250,800 $699,200 $5,809,700 Total assets Accounts payable Income taxes payable Dividends payable Lease liability Common stock, $1 par Paid-in capital in excess of par-common stock Retained earnings $1,019,400 30,100 79,800 389,500 500,000 1,499,000 2,991,100 $6,508,900 $949,200 50,300 99,100 $70,200 (20,200) (19,300) 389,500 500,000 1,499,000 2,712,100 $5,809,700 279,000 $699,200 Total liabilities and stockholders' equity Additional information: 1. On December 31 2016, Martinez acquired 25% of Myers Co.'s common stock for $277,600 On that date the carrying value of Myers s assets and liabilities which approximated their fair values, was $1,110,400. Myers reported income of $124,400 for the year ended December 31, 2017. No dividend was paid on Myers's common stock during the year. 2. During 2017, Martinez loaned $289,200 to TLC Co., an unrelated company. TLC made the first semiannual principal repayment of $38,400, plus interest at 10%, on December 31, 2017 3. On January 2, 2017, Martinez sold equipment costing $60,500, with a carrying amount of $38,400, for $39,800 cash 4. On December 31, 2017, Martinez entered into a capital lease for an office building. The present value of the annual rental payments is $389,500, which equals the fair value of the building. Martinez made the first rental payment of $60,100 when due on January 2, 2018. 5. Net income for 2017 was $358,800. 6. Martinez declared and paid the following cash dividends for 2017 and 2016 2017 2016 Declared Paid Amount December 15, 2017 February 28, 2018 $79,800 December 15, 2016 February 28, 2017 $99,100 Prepare a statement of cash flows for Martinez Corp. for the year ended December 31, 2017, using the indirect method. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).) MARTINEZ CORP Statement of Cash Flows Adjustments to reconcile net income to

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