The information below depicts 2017 summary for Brown Company. The company has two operations, that is, manufacturing and wholesale. All amounts are in thousands. Sales revenue $25,000 Cost of goods sold 16,000 Selling and administrative expenses 4,700 2015 Income taxes 1,244 Goodwill write-off 820 Loss on disposition of wholesale division, net of tax 440 Loss due to flood damage, net of tax (This is extraordinary item) 390 Gain on sale of investments (This is normal and recurring) 110 Loss on operations of wholesale division, net of tax 90 Interest revenue 70 Brown Company has 500 shares of common stock outstanding throughout the year. The company decided to discontinue its entire wholesale operations. On September 1, 2017, Brown Company sold the wholesale operations to Green Company.

Required Prepare a multi-step income statement and earnings per share for the Brown Company.

2. Posterity Inc.s December 31, 2016 balance sheet accounts are copied below:

Cash $20,000

Accounts receivable 21,200

Accounts payable 30,000

Long-term notes payable 41,000

Long-term Investments 32,000

Common stock 100,000 Property, plant, and equipment assets (net of depreciation) 81,000

Retained earnings 23,200

Land 40,000 During 2017,

the following transactions occurred for the company

1. Purchased a tract of land for $18,000 cash.

2. Sold part of its $32,000 investment for $15,000.

This transaction resulted in a gain of $3,400.

The investment was classified as available-for-sale..

Issued additional $20,000 in common stock. The issue was at par.

4. Declared and paid dividends of $8,200 to stockholders.

5. Purchased land through the issuance of $30,000 in bonds.

6. Retired Long-term notes payable with the face value of $16,000. The company paid $16,000 cash.

7. Recorded depreciation expense of $11,000. Net income for 2017 was $32,000. Balances on December 31, 2017 are below: Cash $32,000 Accounts Receivable$41,600 Accounts Payable $30,000 Required: a. Prepare a statement of cash flows for year ended December 31, 2017. Use the indirect method for cash flows from operating activities. b. Explain the uses of the statement of cash flows in making informed decisions.