Use the Sommar Medical Supply Corp. data from P12-71B.
The 2014 and 2013 comparative balance sheets and 2014 income statement of Sommar Medical Supply Corp. follow:

Requirements
1. Prepare the 2014 statement of cash flows by using the direct method.
2. How will what you learned in this problem help you evaluate aninvestment?

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A1 Sommar Medical Supply Corp Comparative Balance Sheets December 31, Increase 2014 2013 (Decrease) Current assets 50,700 15,200 35,500 Cash and cash equivalents Accounts receivable Inventories 64,000 60,000 4,000 65,20053,20012,000 2500(1,500) 48,400 32,60 15,800 8 Prepaid expenses 9 Plant assets: 1,000 Land 11 Equipment, net 12 Total assets 13 Current liabilities: 35,400 26,000 9,400 32,000 36,500 4,500) 22,80024,100 1,300) Accounts payable 15 Salary payable Other accrued liabilities Long-term liabilities: Notes payable 28 19 Stockholders' equity 20 Common stock, no-par 83,20069,000 14,200 64,00027000 37000 S 295400212,600 82.800 Retained earnings 22 Total liabilities and stockholders' equity A1 Sommar Medical Supply Corp Income Statement Year Ended December 31, 2014 | Revenues: 3 Ses revenue 571,000 Expenses Cost of goods sold Salary expense Depreciation expense Other operating expense Interest expense 248,300 94,900 15,000 57,200 24,800 10Income tax expense 1 12 Net income Total expenses 479,300