Reference no: EM131818396

assets                             2018               2017

cash                              40,800             48,400

account receivable         87,800           38,000

inventory                        112,500           102,850

prepaid expenes            28,400              26,000

long-term investment     138,000          109,000

plant Assets                    367,000           242,500

Accumulated depreciation (50,000)      (52,000)

Total                                 724,500         514,750

Liability and stockholder's equity

Accounts payable               72,000        67,300

Accrued Expenses payable  13500       21,000

Dividends payable                3000         -

Bonds payable                     170,000     146,000

Common Stocks                   262,000     175,000

Retailed Earnings                 204,000      105,450

Total                                      724,500       514,750

Additional information

1. old plant assets having an original cost of $57,500 and accumulated depreciation of $48,500 were sold for $1500 cash

2. A new plant asset was purchased directly in exchanged for common stock valued at $42,000

3. New bond were issued at par for $60,000.

4. Net income was $154,480

5. A $1,000 prior period adjustment was recorded in 2017 correcting an understatement of depreciation in 2015.The 2017 balance sheet is appropriately  restated 

Required 

1. Prepare a 2018 statement of cash flows using the indirect method. submit supporting computations.