Use the following financial statements and additional information to

(1) Prepare a statement of cash flows for the year ended December 31, 2016, using the indirect method, and

(2) Analyze and briefly discuss the statement prepared in part 1 with special attention to operating activities and to the company's cash level.

Additional Information
a. No dividends are declared or paid in 2016.
b. Issued additional stock for $10,000 cash in 2016.
c. Purchased equipment for cash in 2016; no equipment was sold in 2016.

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MONTGOMERY INC. Comparative Balance Sheets December 31, 2016 and 2015 2016 OTE 2015 $ 30,400 30,550 2,150 0,050 90,100 O9 30,550 2,850 49,900 Accounts receivable, net Total current assets 41,500 $157,950 $139,050 Liabilities and Equity Accounts payable Salaries payable Total current liabilities Equity Common stock, no par value Retained earnings Total liabilities and equity $ 23,900 25,400 24,400 110,000 100,000 23,550 13.050 $157,950 $139,050 MONTGOMERY INC. Income Statement For Year Ended December 31,2016 Cost of goods sold Gross proft Operating expenses $45,575 8,9 26,625 $7,200 5,550 Depreciation expense Other expenses Total operating expense Income before taxes Income tax expense Net income 12,750 13,875 3,375 $10,500