USE INDIRECT METHOD

Sharp Screen Films, Inc., is developing its annual financial statements at December 31, current year. The statements are complete except for the statement of cash flows. The completed comparative balance sheets and income statement are summarized as follows: Current Year Prior Year Balance sheet at December 31 Cash Accounts receivable Merchandise inventory Property and equipment Less: Accumulated depreciation $ 64,950 15,950 23,150 209,750 (59,700) $254,100 $ 9,700 2,700 61,000 99,600 81,100 $ 254,100 $ 63,900 23,150 18,300 150, 800 (46,050) $210,100 $ 19,900 3,100 71,900 66,200 49,000 $210,100 Accounts payable Wages payable Note payable, long-term Common stock and additional paid-in capital Retained earnings Income statement for current year Sales Cost of goods sold Depreciation expense Other expenses Net income $198,000 95,000 13,650 43,300 $ 46,050 Additional Data: a. Bought equipment for cash, $58,950. b. Paid $10,900 on the long-term note payable. c. Issued new shares of stock for $33,400 cash. d. Dividends of $13,950 were declared and paid. e. Other expenses all relate to wages. f. Accounts payable includes only inventory purchases made on credit. Required: 1. Prepare the statement of cash flows using the indirect method for the year ended December 31, current year. (List cash outflows as negative amounts.) SHARP SCREEN FILMS, INC. . Statement of Cash Flows For the Year Ended December 31, Current Year , Cash flows from operating activities: Adjustments to reconcile net income to net cash provided by operating activities: Cash flows from investing activities: Cash flows from financing activities