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Problem 23-8 Comparative balance sheet accounts of Ayayai Company are presented below AYAYAI COMPANY COMPARATIVE BALANCE SHEET ACCOUNTS AS OF DECEMBER 31 ebit Balances 2017 2016 Cash $51,500 $69,800 Accounts Receivablee 155,600 129,300 61,100 Inventory 75,700 Debt investments (available-for-sale) 54,600 85,500 Equipment 69,300 48,300 Buildings 144,800 144,800 39,600 Land 25,300 $609,400 $545,800 Totals redit Balances Allowance for Doubtful Accounts $10,000 $8,100 Accumulated Depreciation-Equipment 20,900 14,100 Accumulated Depreciation-Buildings 36,900 28,000 Accounts Payable 65,400 60,000 Income Taxes Payable 9,900 11,800 70,000 Long-Term Notes Payable 62,000 Common Stock 310,000 260,000 Retained Earnings 92,400 95,700 $609,400 $545,800 Totals Additional data: 1. Equipment that cost $10,000 and was 60% depreciated was sold in 2017 2. Cash dividends were declared and paid during the year 3. Common stock was issued in exchange for land 4. Investments that cost $34,900 were sold during the year. 5. There were no write-offs of uncollectible accounts during the year. Ayayai's 2017 income statement is as follows Sales revenue $954,500 Less: Cost of goods sold 603,300 Gross profit 351,200 251,500 Less: Operating expenses (includes depreciation expense and bad debt expense) Income from operations 99,700 Other revenues and expenses Gain on sale of investments $14,900 (2,900) 12000 Loss on sale of equipment Income before taxes 111,700 Income taxes 45,000 $66,700 Net income (a) Compute net cash provided by operating activities under the direct method. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Net cash flow from operating activities (b) 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).) AYAYAI COMPANY Statement of Cash Flows For the Year Ended December 31, 2017 Cash Flows from Operating Activities Net Incorne 66700 Adjustments to reconcile net income to Net Cash Provided by Operating Activities Depreciation Expense Gain on Sale of Investments Loss on Sale of Equipment Increase in Accounts Receivable (Net) Increase in Inventory Increase in Accounts Payable Increase in Income Taxes Payable Net Cash Provided by Operating Activities Cash Flows from Investing Activities 7 Purchase of Investments Purchase of Equipment Sale of Investments Sale of Equipment Net Cash Provided by Investing Activities Cash Flows from Financing Activities Payment of Long-term Notes Payable Cash Dividends Paid Issuance of Common Stock Net Cash Used by Financing Activities Net Increase in Cash Cash, January 1, 2017 Cash, December 31, 2017 Noncash Investing and Financing Activities Issuance of Common Stock for Land

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