Use the Sweet Valley data from Problem P14-41B.
In Problem P14-41b
The 2018 income statement and comparative balance sheet of Sweet Valley, Inc. follow:
SWEET VALLEY, INC.
Income Statement
Year Ended December 31, 2018

SWEET VALLEY, INC.
Comparative Balance Sheet
December 31, 2018 and 2017

Additionally, Sweet Valley purchased land of $20,900 by financing it 100% with long-term notes payable during 2018. During the year, there were no sales of land, no retirements of stock, and no treasury stock transactions. A plant asset was disposed of for $0. The cost and the accumulated depreciation of the disposed asset was $13,240.
Requirements
1. Prepare the 2018 statement of cash flows by the direct method.
2. How will what you learned in this problem help you evaluate an investment?

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$ 445,000 Net Sales Revenue Cost of Goods Sold 203,200 Gross Profit 241,800 Operating Expenses: $ 77,400 Salaries Expense Depreciation Expense-Plant Assets 14,500 Other Operating Expenses 10,100 Total Operating Expenses 102,000 Operating Income 139,800 Other Income and (Expenses): Interest Revenue 8,200 Interest Expense (21,100) Total Other Income and (Expenses) (12,900) Net Income Before Income Taxes 126,900 Income Tax Expense 19,400 $ 107,500 Net Income 2018 2017 Assets Current Assets: Cash $ 26,300 $ 15,400 Accounts Receivable 26,400 25,100 Merchandise Inventory 79,300 91,300 Long-term Assets: Land 34,900 14,000 Plant Assets 115,790 108,330 Accumulated Depreciation-Plant Assets (19,890) (18,630) Total Assets $ 262,800 $ 235,500 Liabilities Current Liabilities: Accounts Payable $ 35,600 $ 30,100 Accrued Liabilities 28,900 30,800 Long-term Liabilities: Notes Payable 78,000 105,000 Total Liabilities 142,500 165,900 Stockholders' Equity Common Stock, no par 88,200 64,800 Retained Earnings 32,100 4,800 Total Stockholders' Equity 120,300 69,600 Total Liabilities and Stockholders' Equity $ 262,800 $ 235,500