The 2014 and 2013 balance sheets of Watson Corporation follow
The 2014 and 2013 balance sheets of Watson Corporation follow. The 2014 income statement is also provided. Watson had no noncash investing and financing transactions during 2014. During the year, the company sold equipment for $ 15,600, which had originally cost $ 13,200 and had a book value of $ 11,400. The company did not issue any notes payable during the year but did issue common stock for $ 32,000.

Requirements
1. Prepare the statement of cash flows for Watson Corporation for 2014 using the indirect method.
2. Evaluate the company’s cash flows for the year. Discuss each of the categories of cash flows in your response.




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