Sheridan Company Comparative Balance Sheets December 31 Assets 2019 Cash $93,000 Accounts receivable 89,800 Inventory 120,000 Investments 84,600 Equipment 249,000 Accumulated depreciation-equipment (49,600) $586,800 Liabilities and Stockholders' Equity Accounts payable $58,000 Accrued expenses payable 11,800 Bonds payable 103,000 Common stock 251,000 Retained earnings 163,000 $586,800 2018 $47,500 57,900 101,000 86,900 205,000 (40,100) $458,200 $ 48,800 17,800 69,700 193,000 128,900 $458,200 Sheridan Company Income Statement For the Year Ended December 31, 2019 Sales revenue Gain on disposal of equipment $299,000 8,270 307,270 Less: Cost of goods sold Operating expenses (excluding depreciation expense) Depreciation expense Income tax expense Interest expense $98,600 13,700 50,000 7,800 2,700 172,800 Net income $134,470 Additional information: 1. Equipment costing $91,900 was purchased for cash during the year. 2. Investments were sold at cost. 3. Equipment costing $47,900 was sold for $15,670, resulting in gain of $8,270. 4. A cash dividend of $100,370 was declared and paid during the year. Prepare a worksheet for the statement of cash flows using the indirect method. Enter the reconciling items directly in the worksheet columns. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).) Sheridan Company Worksheet-Statement of Cash Flows Reconciling Items Debit Credit Balance 12/31/18 Balance Sheet Accounts Debits Balance 12/31/19 Cash Accounts receivable Inventory Investments Equipment Totals Credits Accumulated depreciation-Equipment Accounts payable Accrued expenses payable Bonds payable Common stock Retained earnings Totals Statement of Cash Flow Effects Totals Totals