Exercise 23-14 Your answer is partially correct. Try again. Windsor Inc., a greeting card company, had the following statements prepared as of December 31, 2017. WINDSOR INC. COMPARATIVE BALANCE SHEET AS OF DECEMBER 31, 2017 AND 2016 12/31/17 12/31/16 Cash $6,000 $6,900 Accounts receivable 61,800 50,900 Short-term debt investments (available-for-sale) 17,900 Inventory 40,300 60,600 Prepaid rent 5,100 3,900 Equipment 155,100 131,300 Accumulated depreciation-equipment (35,200) (24,800 ) Copyrights 45,800 50,400 Total assets $314,100 $297,100 Accounts payable Income taxes payable Salaries and wages payable Short-term loans payable Long-term loans payable Common stock, $10 par Contributed capital, common stock Retained earnings Total liabilities & stockholders' equity $45,600 4,000 8,100 7,900 60,500 100,000 30,000 58,000 $314,100 $40,000 6,000 4,000 10,000 68,900 100,000 30,000 38,200 $297,100 WINDSOR INC. INCOME STATEMENT FOR THE YEAR ENDING DECEMBER 31, 2017 Sales revenue Cost of goods sold Gross profit Operating expenses Operating income Interest expense $11,400 Gain on sale of equipment 2,000 Income before tax Income tax expense $336,275 173,300 162,975 121,200 41,775 9,400 32,375 6,475 $25,900 Net income Additional information: 1. Dividends in the amount of $6,100 were declared and paid during 2017. 2. Depreciation expense and amortization expense are included in operating expenses. 3. No unrealized gains or losses have occurred on the investments during the year. 4. Equipment that had a cost of $19,900 and was 70% depreciated was sold during 2017. Prepare a statement of cash flows using the indirect method. (Show amounts that decrease cash flow with either a -sign e.g. -15,000 or in parenthesis e.g. (15,000).) WINDSOR INC. Statement of Cash Flows For the Year Ended December 31, 2017 - T Cash Flows from Operating Activities 7 Net Income 25000 Adjustments to reconcile net income to T Net Cash Provided by Operating Activities T Depreciation Expense T 24330 T Gain on Sale of Equipment (2000) Amortization of Copyright 4600 T Increase in Accounts Receivable | T (10900) T Decrease in Inventories 20300 T Increase in Prepaid Rent (1200) Net Cash Provided by Operating Activities