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PROBLEM 2 Brecker Inc., a greeting card company, had the following statements prepared as of December 31, 2017 BRECKER INC COMPARATIVE BALANCE SHEET AS OF DEC 31,2017 & 2016 Cash Accounts Receivable Short-term debt Investment (available for sale Inventory Prepaid Rent Equipment Accumulated Depreciation equipment Copyrights 31-Dec-17 $6.000 $62,000 $35,000 $40,000 $5.000 $154.000 $35,000 $46.000 31-Dec-16 $7.000 $51,000 $18,000 $60,000 $4.000 $130,000 -$25,000 $50,000 Total Assets $313,000 $295,000 Accounts Payable Income tax payable Salaries & wages payable Short-term loans payable Long-term loans payable Common stock. $10 par Contributed Capital, Common Stock Retained Earnings $46.000 $4.000 $8,000 $8.000 $60,000 $100,000 $30.000 $57.000 $40.000 $6.000 $4,000 $10,000 $69,000 $100,000 $30,000 $36.000 Total Liabilities & Stockholder's equity $313,000 $295,000 BRECKER INC. INCOME STATEMENT FOR THE YEAR ENDING DEC 31, 2017 Sales Revenue Cost of Goods Sold Gross Profit Operating Expenses Operating Income Interest Expense Gain on sale of Equipment 31-Dec-17 $338,150 (5175,000) $163.150 ($120,000) $43.150 ($11.400) $2.000 Income before tax Income tax expense Net Income (58.400) $33,750 ($6.750) $27,000 Additional Information 1- Dividends in the amount of $6.000 were de pared and paid during 2017 2- Depreciation expense and amortization expense are included in operating expenses. 3-No unrealized gains or losses have occurred on the investments during the year 4-Equipment that had a cost of $20,000 and was 70% depreciated was sold during 2017, Instructions Prepare a statement of cash flows using the crect method. Do not prepare a reconciliation schedule.)