The comparative statement of financial position for Puffy Ltd. follows:

Additional information:
1. Profit was $115,000.
2. Sales were $978,000.
3. Cost of goods sold was $751,000.
4. Operating expenses were $43,000, exclusive of depreciation expense.
5. Depreciation expense was $34,000.
6. Interest expense was $14,000.
7. Income tax expense was $26,000.
8. Land was sold at a gain of $5,000.
9. No equipment was sold during the year.
10. $50,000 of the bank loan was repaid during the year.
11. Common shares were issued for $25,000.
Instructions
Prepare a statement of cash flows using (a) the indirect method, or (b) the direct method, as assigned by your instructor.

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PUFFY LTD Statement of Financial Position December 31 2012 2011 Assets Cash Accounts receivable Land Equipment Accumulated depreciation Total assets 53,000 80,000 185,000 70,000 265,000 (66,000) $587.000 22,000 76,000 189,000 100,000 200,000 (32,000) $555,000 Liabilities and Shareholders' Equit Accounts payable Bank loan payable Common shares Retained earnings Total liabilities and shareholders' equity 39,000 150,000 199,000 199,000 $587,000 47,000 200,000 174,000 134,000 $555,000