Question 5 The comparative unclassified statement of financial position for Sheridan Ltd. follows: SHERIDAN LTD. Statement of Financial Position December 31 Assets 2018 2017 Cash $58,000 $25,000 Accounts receivable 90,000 61,000 Inventory 183,000 202,000 Long-term investments 79,000 130,000 Equipment 260,000 178,000 Accumulated depreciation (60,000) (39,000) Total assets $610,000 $557,000 Liabilities and Shareholders' Equity Accounts payable $35,000 Bank loan payable 169,000 Common shares 203,000 Retained earnings 203,000 Total liabilities and shareholders' equity $610,000 $ 54,000 189,000 179,000 135,000 $557,000 Additional information: n m 1. Net income was $120,100. 2. Sales were $978,000. Cost of goods sold was $756,000. 4. Operating expenses were $46,000, exclusive of depreciation expense. 5. Depreciation expense was $21,000. 6. Interest expense was $19,000. 7. Income tax expense was $21,000. 8. Long-term investments were sold at a gain of $5,100. 9. No equipment was sold during the year. 10. $20,000 of the bank loan was repaid during the year. 11. Common shares were issued for $24,000. Prepare a statement of cash flows using the indirect method. (Show amounts that decrease cash flow with either a - sign e.g. -45,000, or in parenthesis e.g. (45,000).) SHERIDAN LTD. Statement of Cash Flows-Indirect Method $ Adjustments to reconcile net income to