P12-1 (Static) Preparing a Statement of Cash Flows (Indirect Method) LO12-1, 12-2, 12-4, 12-6 Sharp Screen Films, Inc., is developing its annual financial statements at December 31, current year. The statements are complete except for the statement of cash flows. The completed comparative balance sheets , and income statement are summarized as follows: Current Year Prior Year Balance sheet at December 31 Cash Accounts receivable Merchandise inventory Property and equipment Less: Accumulated depreciation $ 73,250 15,250 23.450 209,250 (57,450) $ 263,750 $ 16,500 2,000 58,300 103,950 85,000 $ 263,750 $ 63,500 21,350 18.000 160,350 (45,750) $ 217,450 $ 19,000 2,700 71.000 65,900 58,850 $217,450 Accounts payable Wages payable Note payable, long-term Common stock and additional pald-in capital Retained earnings Income statement for current year Sales Cost of goods sold Depreciation expense Other expenses Net income $ 205,000 123,500 11,700 43,000 $ 26,800 Additional Data: a. Bought equipment for cash, $48,900. b. Pald $14.700 on the long-term note payable c. Issued new shares of stock for $38,050 cash. d. Dividends of $650 were declared and paid. e. Other expenses all relate to wages. f. Accounts payable includes only inventory purchases made on credit. Required: 1. Prepare the statement of cash flows using the indirect method for the year ended December 31, current year. (List cash outflows as negative amounts.) SHARP SCREEN FILMS, INC. Statement of Cash Flows For the Year Ended December 31, Current Year Cash flows from operating activities: Adjustments to reconcile net income to net cash provided by operating activities: Cash flows from investing activities: Cash flows from financing activities