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Date Jan. 1 July 31 Sept. 2 Nov. 10 Date Jan. 1 Balance Purchase of equipment Cost of equipment constructed Cost of equipment sold Balance Equipment Debit 75,000 56,000 Accumulated Depreciation-Equipment Debit Accumulated depreciation on equipment sold 30,000 Credit Balance 160,000 235,000 291,000 45,000 246,000 Credit Balance 71,000 41,000

\begin{tabular}{|c|c|c|c|c|} \hline \multicolumn{5}{|c|}{ Equipment } \\ \hline Date & & Debit & Credit & Balance \\ \hline \begin{tabular}{l} Jan. \\ 1 \end{tabular} & Balance & & & 160,000 \\ \hline \begin{tabular}{l} July \\ 31 \end{tabular} & Purchase of equipment & 75,000 & & 235,000 \\ \hline \begin{tabular}{l} Sept. \\ 2 \end{tabular} & Cost of equipment constructed & 56,000 & & 291,000 \\ \hline \begin{tabular}{l} Nov. \\ 10 \end{tabular} & Cost of equipment sold & & 45,000 & 246,000 \\ \hline \multicolumn{5}{|c|}{ Accumulated Depreciation-Equipment } \\ \hline Date & & Debit & Credit & Balance \\ \hline \begin{tabular}{l} Jan. \\ 1 \end{tabular} & Balance & & & 71,000 \\ \hline & Accumulated depreciation on equipment sold & 30,000 & & 41,000 \\ \hline \end{tabular} Accumulated Depreciation-Equipment \begin{tabular}{|c|c|c|c|c|} \hline Date & & Debit & Credit & Balance \\ \hline \begin{tabular}{l} Jan. \\ 1 \end{tabular} & Balance & & & 71,000 \\ \hline \begin{tabular}{l} Nov. \\ 10 \end{tabular} & Accumulated depreciation on equipment sold & 30,000 & & 41,000 \\ \hline \begin{tabular}{l} Dec. \\ 31 \end{tabular} & Depreciation for year & & 20,000 & 61,000 \\ \hline \multicolumn{5}{|c|}{ Retained Earnings } \\ \hline Date & & Debit & Credit & Balance \\ \hline \begin{tabular}{l} Jan. \\ 1 \end{tabular} & Balance & & & 105,000 \\ \hline \begin{tabular}{l} Aug. \\ 23 \end{tabular} & Dividends (cash) & 15,000 & & 90,000 \\ \hline Dec. & Net income & & 50,000 & 140,000 \\ \hline \end{tabular} From the postings in the accounts, indicate how the information is reported on a statement of cash flows using the indirect method. The loss on sale of equipment was $7,000. (Hint: Cost of equipment constructed is reported in the investing activities section as a decrease in cash of $56,000 ) (Show amounts that decrease cash flow with either asign e.g. 15,000 or in parenthesis e.g. (15,000) )

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