The 2016 income statement and comparative balance sheet of One Stop, Inc. follow:

Additionally, One Stoppurchased land of $25,900 by financing it 100% with long-term notes payable during 2016. During the year, there were no sales of land, no retirements of stock, and no treasury stock transactions. A plant asset was disposed of for $0. The cost and accumulated depreciation of the disposed asset was $12,620. The plant acquisition was for cash.

Requirements

1.	Prepare the 2016 statement of cash flows by the direct method.
2.	How will what you learned in this problem help you evaluate an investment?

One Stop, Inc.
Income Statement
Year Ended December 31, 2016
Sales Revenue		$438,000
Cost of Goods Sold		208,200
Gross Profit		229,800
Operating Expenses:
Salaries Expense	$72,400
Depreciation ExpensePlant Assets	14,500
Other Operating Expenses	10,200
Total Operating Expenses		97,100
Operating Income		132,700
Other Revenues and (Expenses):
Interest Revenue	8,600
Interest Expense	-21,000
Total Other Revenues and (Expenses)		-12,400
Net Income Before Income Taxes		120,300
Income Tax Expense		19,400
Net Income		$100,900

One Stop, Inc.
Comparative Balance Sheet
December 31, 2016 and 2015
		2016	2015
Assets
Current Assets:
Cash		$26,900	$15,500
Accounts Receivable		26,300	25,400
Merchandise Inventory		79,100	91,200
Long-term Assets:
Plant Assets		118,600	113,520
Accumulated DepreciationPlant Assets		-18,700	-16,820
Land		34,900	9,000
Total Assets		$267,100	$237,800
Liabilities
Current Liabilities:
Accounts Payable		$35,800	$29,900
Accrued Liabilities		28,000	30,900
Long-term Liabilities:
Notes Payable		77,000	100,000
Total Liabilities		140,800	160,800
Stockholders' Equity
Common Stock, no par		89,000	64,400
Retained Earnings		37,300	12,600
Total Stockholders' Equity		126,300	77,000
Total Liabilities and Stockholders' Equity		$267,100	$237,800