Prior Year MONGOMERY INC. Comparative Balance Sheets December 31 Current Year Assets Cash $ 38,200 Accounts receivable, net 10,800 Inventory 96, 800 Total current assets 145,800 Equipment 53,600 Accum. depreciation-Equipment (24,200). Total assets $175, 200 Liabilities and Equity Accounts payable $ 25,700 Salaries payable 400 Total current liabilities 26,100 Equity Common stock, no par value 129, 300 Retained earnings 19,800 Total liabilities and equity $175,200 $ 38,700 13,400 77,500 129,600 45,800 (16,900) $ 158,500 $ 28, 100 500 28, 600 119,000 10,900 $158,500 MONTGOMERY INC. Income Statement For Current Year Ended December 31 Sales $ 40,300 Cost of goods sold (16,700) Gross profit 23,600 Operating expenses Depreciation expense $ 7,300 Other expenses 5,000 Total operating expense 12,300 Income before taxes 11,300 Income tax expense 2.400 Net income $ 8,900 Help Additional Information on Current-Year Transactions a. No dividends are declared or paid. b. Issued additional stock for $10,300 cash. c. Purchased equipment for cash; no equipment was sold. 1. Use the above information to prepare a statement of cash flows for the current year using the Indirect method. (Amounts to be deducted should be indicated by a minus sign.) MONTGOMERY, INC. Statement of Cash Flows (Indirect Method) For Current Year Ended December 31 Cash flows from operating activities Adjustments to reconcile net income to net cash provided by operations: Income statement items not affecting cash Changes in current operating assets and liabilities + 10, 11, 12 & 13) i Saved Help Cash flows from operating activities Adjustments to reconcile net income to net cash provided by operations: Income statement items not affecting cash Changes in current operating assets and liabilities Cash flows from investing activities Cash flows from financing activities Cash balance at beginning of year Cash balance at end of year