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Statement of Cash Flows-Indirect Method The comparative balance sheet of Yellow Dog Enterprises Inc. at December 31, 20Y8 and 2017, is as follows: Dec. 31, 20Y8 Dec. 31, 2017 Assets Cash $57,350 $70,130 Accounts receivable (net) 88,120 94,540 Inventories 125,870 117,180 Prepaid expenses 5,130 3,550 Equipment 256,430 209,940 (66,670) (51,490) Accumulated depreciation-equipment Total assets $466,230 $443,850 $97,910 $92,760 Liabilities and Stockholders' Equity ' Accounts payable (merchandise creditors) Mortgage note payable Common stock, $1 par 0 133,160 14,000 9,000 Paid-in capital in excess of par-common stock 200,000 125,000 83,930 Retained earnings 154,320 Total liabilities and stockholders' equity ' $466,230 $443,850 Additional data obtained from the income statement and from an examination of the accounts in the ledger for 20Y8 are as follows: a. Net income, $180,200. b. Depreciation reported on the income statement, $32,610. c. Equipment was purchased at a cost of $63,920 and fully depreciated equipment costing $17,430 was discarded, with no salvage realized. d. The mortgage note payable was not due for six years, but the terms permitted earlier payment without penalty. e. 5,000 shares of common stock were issued at $16 for cash. f. Cash dividends declared and paid, $109,810. Required: Required: Prepare a statement of cash flows, using the indirect method of presenting cash flows from operating activities. Use the minus sign to indicate cash outflows, cash payments, decreases in cash, or any negative adjustments. Yellow Dog Enterprises Inc. Statement of Cash Flows For the Year Ended December 31, 2048 Cash flows from (used for) operating activities: Net income 180,200 Adjustments to reconcile net income to net cash flow from operating activities: Depreciation 32,610 Changes in current operating assets and liabilities: Decrease in accounts receivable Increase in inventories Increase in prepaid expenses Increase in accounts payable Net cash flow from operating activities Cash flows from (used for) investing activities: Cash paid for equipment ! 01 | di Net cash flow used for investing Cash flows from (used for) financing activities: Cash received from sale of common stock Cash paid for dividends Cash paid to retire mortgage note payable Net cash flow used for financing activities Net decrease in cash Cash balance, January 1, 2048 Cash balance, December 31, 2048 Profitability Ratios The following selected data were taken from the financial statements of Vidahill Inc. for December 31, 2017, 2086, and 2015: December 31 2017 2016 2015 Accounting numeric field Total assets Notes payable (8% interest) $175,000 $158,000 $141,000 60,000 60,000 60,000 Common stock 24,000 24,000 24,000 Preferred 6% stock, $100 par 12,000 12,000 12,000 (no change during year) Retained earnings 66,970 48,715 36,000 The 2017 net income was $18,975, and the 20Y6 net income was $13,435. No dividends on common stock were declared between 2015 and 2017. Preferred dividends were declared and paid in full in 2046 and 2017. a. Determine the return on total assets, the return on stockholders' equity, and the return on common stockholders' equity for the years 2046 and 2017. When required, round to one decimal place. 2017 2016 Return on total assets % % Return on stockholders' equity % % Return on common stockholders' equity % % V. Since the return on assets is less than the return on stockholders' equity in both years, there must be positive leverage from the use b. The profitability ratios indicate that the company's profitability has improved of debt