The comparative balance sheets for Indigo Company as of December $31$ are as follows.

Indigo Company

Comparative Balance Sheets

December $31$

Assets

$2025$

$2024$

Cash

$ $70,720$

$ $46,800$

Accounts receivable

$52,000$

$60,320$

Inventory

$157,508$

$147,680$

Prepaid expenses

$15,891$

$21,840$

Land

$150,800$

$135,200$

Buildings

$208,000$

$208,000$

Accumulated depreciation$$buildings

$(62,400)$

$(41,600)$

Equipment

$234,000$

$161,200$

Accumulated depreciation$$equipment

$(46,800)$

$(36,400)$

Total

$$779,719$

$$703,040$

Liabilities and Stockholders$$ Equity

Accounts payable

$ $46,519$

$ $37,440$

Bonds payable

$312,000$

$312,000$

Common stock, $$1$ par

$208,000$

$166,400$

Retained earnings

$213,200$

$187,200$

Total

$$779,719$

$$703,040$

Additional information:

$1.$ Operating expenses include depreciation expense of $$43,680($$$20,800$ of depreciation expense for buildings and $$22,880$ for equipment$).$

$2.$ Land was sold for cash at book value.

$3.$ Cash dividends of $$12,480$ were declared and paid.

$4.$ Net income for $2025$ was $$38,480.$

$5.$ Equipment was purchased for $$95,680$ cash. In addition, equipment costing $$22,880$ with a book value of $$10,400$ was sold for $$8,320$ cash.

$6.41,600$ shares of $$1$ par value common stock were issued in exchange for land with a fair value of $$41,600.$

Prepare a statement of cash flows for the year ended December $31,2025,$ using the indirect method. $($Show amounts that decrease cash flow with either a $-$ sign e$.$g$.-15,000$ or in parenthesis e$.$g$.(15,000).)$

INDIGO COMPANY

Statement of Cash Flows $$ Indirect Method

choose the accounting period

For the Year Ended December $31,2025$

Correct answer

select an opening name for section one

Cash Flows from Operating Activities

Correct answer

select an item

Net Income

Correct answer

$enter a dollar amount

$38,480$

Adjustments to reconcile net income to

select an opening subsection name

Net Decrease in Cash

:

select an item

Depreciation Expense

Correct answer

$enter a dollar amount

Incorrect answer

select an item

enter a dollar amount

Incorrect answer

select an item

enter a dollar amount