The 2017 comparative balance sheet and income statement of Riverbend Pools Inc. follow. Riverbend had no non-cash investing and financing transactions during 2017. During the year, there were no sales of land or equipment, no issuances of notes payable, and no share repurchase transactions.

Requirements
1. Prepare the statement of cash flows of Riverbend Pools Inc. for the year ended December 31, 2017. Determine cash flows from operating activities by the indirect method.
2. How will what you learned in this problem help you evaluate an investment?

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Riverbend Pools Ino. Comparative Balance Sheet As at December 31, 2017 and 2016 Increase (Decrease) 2 2017 2016 3 Current assets 4 Cash and cash equivalents Accounts receivable Inventories $ 28,700 15,600 44,000 89,900 2,200 47,100 94,300 1,700 $13,100 3,100 4,400 (500) 7 Prepaid expenses 8 Property, plant, and equipment: 35,100 100,900 25,100 7,200 $52,400 Land 10,000 93,700 $307,800 255,400 10 11 Total assets 12 Current liabilities: 13 14 Salary payable 15 Other 16 Long-term liabilities 17 18 Shareholders' equity: 19 Common shares 20 21 Total liabilities and shareholder's equit uipment, net Accounts payable $ 22,700 24,600 1,400 22,500 (1,900) 700 1,900 2,100 d liabilities 24,400 55,000 131,100 Notes payable 65,000 (10,000) 122,300 19,600 8,800 52,900 $52.400 Retained earnings 72,500 Riverbend Pool Inc. Income Statement For the Year Ended December 31, 2017 2 Revenues Sales revenue 438,000 S 11,700 449,700 4 Interest revenue Total revenues 6 Expenses: 7Cost of goods sold $185,200 76,400 15,300 49,700 24,600 16,900 Salary expense 9 Depreciation expense 10 Other operating expense Interest expense Income tax expense 12 13 14 Net income 15 Total expenses 368,100 $ 81,600