(SCFIndirect Method, and Net Cash Flow from Operating Activities, Direct Method) Com- parative balance sheet accounts of Marcus Inc. are presented below. MARCUS INC. COMPARATIVE BALANCE SHEET ACCOUNTS As of DECEMBER 31, 2014 AND 2013 December 31 Debit Accounts 2014 2013 Cash $ 42,000 $ 33,750 Accounts Receivable 70,500 60,000 Inventory 30,000 24,000 Investments (available-for-sale) 22.250 38,500 Machinery 30,000 18,750 Buildings 67,500 56,250 Land 7,500 7,500 $269,750 $238,750 Credit Accounts Allowance for Doubtful Accounts $ 2.250 $ 1,500 Accumulated Depreciation-Machinery 5,625 2,250 Accumulated Depreciation - Buildings 13,500 9,000 Accounts Payable 35,000 24,750 Accrued Payables 3,375 2,625 Long-Term Notes Payable 21,000 31,000 Common Stock, no-par 150,000 125,000 Retained Earnings 39,000 42,625 $269,750 $238,750 Additional data (ignoring taxes): 1. Net income for the year was 542,500. 2. Cash dividends declared and paid during the year were $21,125. 3. A 20% stock dividend was declared during the year. $25,000 of retained earnings was capitalized. 4. Investments that cost $25,000 were sold during the year for $28,750. 5. Machinery that cost $3,750, on which $750 of depreciation had accumulated, was sold for $2,200. Marcus's 2014 income statement follows (ignoring taxes). Sales revenue $540,000 Less: Cost of goods sold 380,000 Gross margin 160,000 Less: Operating expenses (includes $8,625 depreciation and $5,400 bad debts) 120,450 Income from operations 39,550 Other: Gain on sale of investments $3,750 Loss on sale of machinery (800 2,950 Net income $ 42,500 Instructions (a) Compute net cash flow from operating activities using the direct method. (b) Prepare a statement of cash flows using the indirect method