The accounts below appear in the ledger of Harvey Company.

Instructions
From the postings in the accounts above, indicate how the information is reported on a statement of cash flows by preparing a partial statement of cash flows using the indirect method. The gain on sale of equipment (September 25) was$36,600.

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Retained Earnings Dr Cr. Bal Jan. 1, 2014 Credit Balance Dec 1 Dec. 31 Declare and pay dividends Net Income for 2012 $140,000 100,000 $40,000 $82,600 182,600 Machinery Dr. Cr. Bal Jan. 1, 2014 Debit Balance Mar. 31 Sept. 25 $740,000 896,000 $156,000 Purchase of Machinery Machinery Sold Accumulated Depreciation $202,000 694,000 Machinery Dr Cr Bal Jan. 1, 2014 Credit Balance June 18 Sept. 25 Extraordinary Repairs Accum. Depreciation on $264,000 208,000 $56,000 Machinery Sold Depreciation for 2012 60,000 148,000 Dec. 31 $82,500 230,500