1. The comparative balance sheet of ConnieJo Company, for December 31, Years 1 and 2 ended December 31 appears below in condensed form:

   	Year 2	Year 1
   Assets
   Cash	$45,000	$53,500
   Accounts receivable (net)	51,300	58,000
   Inventories	147,200	135,000
   Investments	0	60,000
   Equipment	493,000	375,000
   Accumulated depreciationequipment	(113,700)	(128,000)
   Total assets	$622,800	$553,500
   Liabilities and Stockholders' Equity
   Accounts payable	$61,500	$42,600
   Bonds payable, due Year 4	0	100,000
   Common stock, $10 par	250,000	200,000
   Paid-in capital in excess of parcommon stock	75,000	50,000
   Retained earnings	236,300	160,900
   Total liabilities and stockholders' equity	$622,800	$553,500

   The income statement for the current year is as follows:

   Sales			$629,700
   Cost of goods sold			341,800
   Gross profit			$287,900
   Operating expenses:
   Depreciation expense	$ 24,700
   Other operating expenses	75,300
   Total operating expenses			100,000
   Income from operations			$187,900
   Other income:
   Gain on sale of investment	$5,000
   Other expense:
   Interest expense	12,000		(7,000)
   Income before income tax			$180,900
   Income tax			64,100
   Net income			$116,800

   Additional data for the current year are as follows:

   1. Fully depreciated equipment costing $39,000 was scrapped, no salvage, and equipment was purchased for $157,000.
   2. Bonds payable for $100,000 were retired by payment at their face amount.
   3. 5,000 shares of common stock were issued at $15 for cash.
   4. Cash dividends declared were paid $41,400.
   5. All sales are on account.

   Prepare a statement of cash flows, using the indirect method of reporting cash flows from operating activities. Use the minus sign to indicate cash outflows, cash payments, decreases in cash, or any negative adjustments.

   ConnieJo Company Statement of Cash Flows For the Year Ended December 31, Year 2

   Cash flows from operating activities:
   Cash from sale of common stockCash from sale of investmentsCash paid to retire bonds payableDecrease in inventoriesNet income	$- Select -
   Adjustments to reconcile net income to net cash flow from operating activities:
   Cash from sale of common stockCash paid for dividendsCash paid to retire bonds payableDecrease in inventoriesDepreciation	- Select -
   Cash from sale of common stockCash from sale of investmentsCash paid for purchase of equipmentDecrease in inventoriesGain on sale of investments	- Select -
   Cash paid for dividendsCash paid for purchase of equipmentCash paid to retire bonds payableDecrease in accounts receivableDecrease in inventories	- Select -
   Cash from sale of investmentsCash paid for dividendsCash paid for purchase of equipmentIncrease in accounts payableIncrease in inventories	- Select -
   Cash from sale of common stockCash from sale of investmentsCash paid for dividendsDecrease in inventoriesIncrease in accounts payable	- Select -
   Net cash flow from operating activities		$fill in the blank 13
   Cash flows from investing activities:
   Cash received from sale of investmentsDepreciationGain on sale of investmentsIncrease in inventoriesNet income	$- Select -
   Cash from sale of common stockCash paid for purchase of equipmentGain on sale of investmentsIncrease in accounts payableIncrease in inventories	- Select -
   Net cash flow used for investing activities		fill in the blank 18
   Cash flows from financing activities:
   Cash received from sale of common stockCash received from sale of investmentsDepreciationGain on sale of investmentsIncrease in inventories	$- Select -
   Cash paid for dividendsDecrease in accounts receivableDepreciationGain on sale of investmentsIncrease in inventories	- Select -
   Cash paid for purchase of equipmentCash paid to retire bonds payableDecrease in accounts receivableDepreciationIncrease in inventories	- Select -
   Net cash flow used for financing activities		fill in the blank 25
   Accounts payableCashChange in cashDepreciationInventories		$- Select -
   Cash at the beginning of the year		fill in the blank 28
   Cash at the end of the year		$fill in the blank 29