Question 3 of 4 < Carla Vista Company Comparative Balance Sheets December 31 2025 2024 Assets Cash $87,500 $50,000 Accounts receivable 50,000 35,000 Inventory 70,000 50,000 Property, plant, and equipment 150,000 195,000 Accumulated depreciation (80,000) (60,000) Total $277,500 $270,000 Liabilities and Stockholders' Equity -/2 Accounts payable $47,500 $ 37,500 Income taxes payable 17,500 20,000 Bonds payable 42,500 82,500 Common stock 45,000 35,000 Retained earnings 125,000 95,000 Total $277,500 $270,000 SUPPORT Question 3 of 4 < > Income Statement For the Year Ended December 31, 2025 Sales revenue $605,000 Cost of goods sold 437,500 Gross profit 167,500 Selling expenses $45,000 Administrative expenses 15,000 60,000 Income from operations 107,500 Interest expense 7,500 Income before income taxes 100,000 Income tax expense 20,000 Net income $80,000 Additional data: 1. Depreciation expense was $43,750. 2. Dividends declared and paid were $50,000. 3. -/2 E : During the year, equipment was sold for $21,250 cash. This equipment originally cost $45,000 and had accumulated depreciation of $23,750 at the time of sale. 4. Bonds were redeemed at their carrying value. 5. Common stock was issued at par for cash. SUPPORT Prepare a statement of cash flows 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).) CARLA VISTA COMPANY Statement of Cash Flows - Indirect Method Adjustments to reconcile net income to $ $ SUPPORT