The following comparative balance sheets and income statement are available for ABC Inc. Prepare a statement of cash flows for 2016 using the indirect method and analyze the statement.

December 31, 2016 2015

Cash $ 3 300 $1 000

Accounts receivable(net) 1,100 600 I

inventory 11,200 4,300

Total Current Assets $15,600 $5,900

Plant and equipment $ 3,000 $2,300

Less accumulated depreciation (1,300) (800)

Plant and equipment (net) $ 1,700 $1,500

Long-term invesbnents 1,200 900

Total Assets $18,500 $8,300

Accounts payable $ 3 300 $2,500

Accrued liabilities 700 600

Income taxes payable 400 100

Total Current Liabilities $ 4,400 $3,200

Long-term debt 200 0

Total Liabilities $ 4,600 $3,200

Common stock ($1par) and additional paid-in capital 9,900 7,300

Retained earnings 4,000 (2,200)

Total Liabilities and Equity $18,500 $8,300

Income Statement for 2016

Sales $94 000

Cost of goods sold 55 000

Gross profit $39,000

Selling and administrative 28,800

Depreciation 500 29,300

Operating profit $ 9,700 I

interest expense 100

Earnings before tax $ 9 600

Tax expense 3 400

Net income $ 6,200