Lockerbie & Hole Inc. began operations on January 1, 2013. Its post-closing trial balance at

December 31, 2013 and 2014, is shown below along with some other information.

Other information regarding Lockerbie & Hole Inc. and its activities during 2014:
1. Assume all accounts have normal balances.
2. Cash dividends were declared and paid during the year.
3. Equipment was sold for cash equal to its book value.

Required
Using the information provided, prepare a statement of cash flows (applying the indirect method) for the year ended December 31, 2014.
Analysis Component: Assume that the investing activities section of the statement of cash flows showed a net cash outflow of $14 thousand. What could this represent? Is a net cash outflow from investing activities necessarily favourable or unfavorable?Explain.

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Lockerble & Hole Inc. Lockerbie & Hole Inc. Post-Closing Trial Balance (000s) Income Statement For Year Ended December 31, 2014 (000s) December 31 Account 2014 2013 Revenues: Cash $1,260 1,440 $2,160 Sales. $3,300 Receivables 2,100 Merchandise inventory. Property, plant and equipment. Accumulated depreciation. Accounts payable. Expenses: Cost of goods sold. Other expenses. Depreciation expense. Total expenses. 2,040 2,280 $2,520 3,720 1,440 1,440 3,960 1,380 660 240 1,080 3,420 Accrued liabilities 240 360 Net loss. $ 120 Bonds payable. 1,680 1,800 Common shares. 3,084 2,040 Retained earnings.. 2,136 2,280