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Union Brake Inc.s comparative balance sheet information at December 31, 2017, and 2016, and its income statement for the year ended December 31, 2017, are as follows:

Union Brake Inc.
Income Statement
For Year Ended December 31, 2017
Sales				$	884,000
Cost of goods sold					574,000
Gross profit				$	310,000
Operating expenses	$	132,700
Depreciation expense		41,260			173,960
Operating Profit					136,040
Loss on sale of equipment		10,460
Investment income		17,520
Profit before taxes					143,100
Income taxes					30,000
Profit					113,100

Union Brake Inc.
Balance Sheet Information
	December 31
	2017			2016			Net Change
Cash	$	46,000		$	24,560		$	21,440
Cash equivalents		23,280			9,200			14,080
Accounts receivable		87,920			35,440			52,480
Inventory		113,840			81,520			32,320
Investment		0			23,280			(23,280)
Land		76,400			76,400			0
Building and equipment		428,660			446,180			(17,520)
Accumulated depreciation		116,080			94,960			21,120
Accounts payable		13,700			37,400			(23,700)
Dividends payable		1,200			800			400
Bonds payable		22,000			0			22,000
Preferred shares		81,200			81,200			0
Common shares		405,680			405,680			0
Retained earnings		136,240			76,540			59,700

During 2017, the following transactions occurred: 1. Purchased equipment for $20,400 cash. 2. Sold the long-term investment on January 1, 2017 for $40,800, resulting in investment income of 17,520. 3. Sold equipment for $7,320 cash that had originally cost $37,920 and had $20,140 of accumulated depreciation. 4. Issued $22,000 of bonds payable at face value.

Required: 1. How much cash was paid in dividends?

2. Prepare a statement of cash flows for Union Brake for the year ended December 31, 2017, using the indirect method. (List any deduction in cash and cash outflows as negative amounts.)

UNION BRAKE INC. Statement of Cash Flows For Year Ended December 31, 2017 Cash flows from operating activities: Adjustments to reconcile profit to net cash inflows from operating activities: Cash and cash equivalents, December 31, 2017 Cash flows from investing activities: Cash flows from financing activities: 0

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