Tom Couro Associates closed its books for the current year. The firm provided the following comparative balance sheets and income statement. (Click the icon to view the balance sheets.) (Click the icon to view the income statement.) The company sold its indefinite-life intangible assets at their carrying value. Cash was used to acquire land. The debt investments were purchased on December 31. Requirement Prepare the company's cash flow statement for the current year under the indirect method. Present any required disclosures. Complete the statement one section at a time, beginning with the cash flows from operating activities. (Use a minus sign or parentheses for any numbers to be subtracted and/or net cash used by activities. If a box is not used in the statement, leave the box empty; do not select a label or enter a zero.) Tom Couro Statement of Cash Flows (Indirect Method) For the Year Ended December 31 Operating Activities: Current Year Adjustments to Reconcile Net Income to Net Cash from Operating Activities: Changes in Operating Working Capital Accounts: Net Cash Provided (Used) by Operating Activities Investing Activities: Net Cash Provided (Used) by Investing Activities Financing Activities: Net Cash Provided (Used) by Financing Activities Net Increase (Decrease) in Cash and Cash Equivalents Cash and Cash Equivalents, Beginning of Year Cash and Cash Equivalents, End of Year Provide all required cash flow disclosures. Cash Flow Disclosures for the Direct Method Significant Noncash Investing and Financing Activities: Accounting Policy for the Definition of Cash Equivalents: For purposes of the statement of cash flows, the company considers all debt instruments purchased with maturities of three months or less to be cash equivalents. Cash Paid for Taxes and Interest Cash Paid for Taxes Cash Paid for Interest Current Assets Balance Sheets At December 31 Assets Ending Beginning Cash $ 18,120 $ 40,300 Held-to-Maturity Debt Investments Accounts Receivable-net 30,400 0 24,950 27,500 Merchandise Inventory 46,400 36,500 Prepaid Expenses 24,100 14,200 $ 143,970 $ 118,500 Total Current Assets Noncurrent Assets Land $ 943,130 $ 768,880 Property, Plant, and Equipment 1,686,850 1,686,850 Accumulated Depreciation (342,900) (320,500) 0 23,600 Indefinite-Life Intangible Assets $ 2,287,080 $ 2,158,830 Total Noncurrent Assets $ 2,431,050 $ 2,277,330 Total Assets Liabilities Current Liabilities Accounts Payable $ 74,500 $ 40,500 Dividends Payable 22,900 0 18,900 10,500 Income Taxes Payable $ Total Current Liabilities 116,300 $ 51,000 Noncurrent Liabilities Notes Payable $ 107,800 $ 453,600 $ 107,800 $ 453,600 Total Noncurrent Liabilities $ 224,100 $ 504,600 Total Liabilities Shareholders' Equity Common Stock, $1 par value $ 685,900 $ 501,850 Additional Paid-in Capital in Excess 927,550 771,300 of Par - Common Additional Paid-in Capital - Stock Options 37,800 0 555,700 499,580 Retained Earnings Tom Couro Associates Income Statement For the Year Ended December 31 Current Year Sales $ 795,950 Cost of Goods Sold 477,700 Gross Profit 318,250 Selling, General, and Administrative Expenses $ 83,500 Bad Debt Expense 8,100 22,400 Depreciation Expense $ 114,000 Total Operating Expenses Operating Income Interest Expense Interest Income Income before Tax Income Tax Expense Net Income 10 10 204,250 (7,350) 1,700 198,600 (79,600) 119,000