Refer to Kazaam Company€™s financial statements and related information in Problem 16-1A.

Required
Prepare a complete statement of cash flows; report its operating activities according to the direct method. Disclose any noncash investing and financing activities in anote.

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KAZAAM COMPANY Comparative Balance Sheets December 31,2011 and 2010 2011 20 53.875 76,625 65,000 49.625 273.750 252,500 6,250 Equipment .59,500 110,000 4.625)44.000) $522,875 $451,000 KAZAAM COMPANY Income Statement For Year Ended December 31,2011 Accounts recelvable Merchandise Inventory Prepaid expenses 5,375 $496,250 Accum. Sales..**r. Cost of goods sold Gross profit .. Operating expenses 250.000 Total assets 246,250 Liabilities and Equity Depreclation expense$ 18,750 Short-term notes payable Long-term notes payable. Common stock, $5 par value 6,250 93,750 53,750 168,750 156,250 10.000 Other expenses Other gains (losses) 136,500 1,250L Loss on sale of equipment . . income before taxes Income taxes expense . Net Income 525 Pald-In capital in excess 85,875 32,500 129,750 18,125 $522,875 $451,000 of par, common stock 12,125 Retalned earnings $ 73,750 Total Ilablllties and equlty