Presented on next page are the comparative balance sheets for Vernet Company atDecember 31.

Additional information:1. Operating expenses include depreciation expense $55,000 and charges from prepaid expenses of $4,400.2. Land was sold for cash at cost.3. Cash dividends of $84,290 were paid.4. Net income for 2012 was $47,890.5. Equipment was purchased for $80,000 cash. In addition, equipment costing $40,000 with a book value of $33,000 was sold for $37,000 cash.6. Bonds were converted at face value by issuing 30,000 shares of $1 par value common stock.InstructionsPrepare a statement of cash flows for 2012 using the indirectmethod.

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VERNET COMPANY Comparative Balance Sheets December 31 2012 Assets 2011 $ 41,000 $ 57.000 Cash Accounts receivable 77,000 64.000 140,000 16,540 Inventory Prepaid expenses 172,000 12,140 Land 110,000 150,000 Equipment Accumulated depreciation-equipment Buildings Accumulated depreciation-buildings 215.000 175,000 (42,000) (70,000) 250,000 250,000 (70.000) (50,000) $737.140 $760,540 Total Liabilities and Stockholders' Equity $ 58,000 $ 45,000 Accounts payable Bonds payable Common stock, $1 par Retained earnings 265,000 235,000 280,000 250.000 164.140 200,540 Total $760,540 $737,140