Condensed financial data of Cheng Inc. follow.

Additional information:
1. New equipment costing $85,000 was purchased for cash during the year.
2. Old equipment having an original cost of $57,500 was sold for $1,500 cash.
3. Bonds matured and were paid off at face value for cash.
4. A cash dividend of $40,350 was declared and paid during the year.

Instructions
Prepare a statement of cash flows using the indirectmethod.

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CHENG INC. Comparative Balance Sheets December 31 Assets Cash Accounts receivable Inventory Prepaid expenses Investments Equipment Accumulated depreciation equipment 2014 80,800 92,800 117,500 28,400 143,000 270,000 (50,000) 682,500 2013 48,400 33,000 102,850 26,000 114,000 242,500 (52,000) $514,750 Total Liabilities and Stockholders' Equit Accounts payable Accrued Bonds payable Common stock Retained earnings $112,000 16,500 110,000 220,000 224,000 $682,500 67,300 17,000 150,000 175,000 105,450 $514,750 expenses payable Total CHENG INC. Income Statement For the Year Ended December 31, 2014 Sales revenue Less $392,780 Cost of goods sold Operating expenses, excluding $135,460 depreciation Depreciation expense Income tax expense Interest expense Loss on disposal of plant assets 12,410 46,500 27,280 4,730 7,500 233,880 $158,900 Net income